WALLACH, Circuit Judge.
Appellants Gordon and Denise Woodley ("Woodleys") challenge the decision of the United States Court of Federal Claims ("Claims Court") approving a settlement agreement in a class action takings suit and awarding attorney fees to class counsel under the common fund doctrine. The United States ("Government") confesses error for failing to support the Woodleys' claim before the Claims Court and, like the Woodleys, now asserts the Claims Court erred in approving the settlement agreement and awarding class counsel attorney fees under the common fund doctrine. For the reasons set forth below, we vacate and remand on both issues.
I. Procedural History
This is an appeal by two members of a certified class in a class action suit, challenging the Claims Court's approval of a $110 million settlement agreement and its decision to award class counsel approximately $35 million in attorney fees. See Haggart v. United States (Haggart IV), 116 Fed.Cl. 131 (2014). In 2003, Burlington Northern Railroad sought to divest its interest in three segments of land in King County, Washington. The divestiture was accomplished pursuant to section 208 of the National Trails Systems Act Amendments of 1983, 16 U.S.C. § 1247(d) ("Trails Act").
In February 2009, Daniel and Kathy Haggart filed a complaint alleging that they and other landowners held interests in the railroad corridor and the Trails Act effected an uncompensated taking, in violation of the Fifth Amendment's Takings Clause, when King County acquired an interest in the land.
In September 2009, the Claims Court certified the class as an opt-in class action in accordance with Rule 23 of the Rules of the United States Court of Federal Claims ("RCFC"). See Haggart v. United States (Haggart I), 89 Fed.Cl. 523, 536 (2009). On October 16, 2009, class counsel notified the Claims Court and the Government that attorney fees "will be the greater of (a) 35% of any recovery (45% if the case is appealed); or (b) its statutory attorney fees." S.A. 239.
II. Settlement Negotiations
After the Claims Court's decision in Haggart III, the parties commenced settlement
III. The Claims Court's Approval of the Settlement Agreement and Award of Attorney Fees
On February 12, 2014, class counsel and the Government filed a joint motion for approval of the settlement agreement. The joint motion asserted that "the proposed settlement is fair, reasonable, and adequate with respect to the individual claims of each opt-in class member and as to the class as a whole." S.A. 375. A day later, class counsel moved for an additional award of attorney fees under the common-fund doctrine.
On February 25, 2014, the Claims Court preliminarily approved the proposed settlement agreement and also approved a notice to be sent to the 253 class members. On February 27, 2014, a slightly revised notice advising class members of the overall settlement terms, as well as the settlement terms for the claims of individual class members (the notice included an individual disclosure page, which provided the principal and interest for each landowner's property) and attorney fees, was sent to class members.
The Claims Court held a fairness hearing on March 28, 2014. Of the 253 class members, only three participated in the hearing.
The Woodleys appeal the settlement approval and award of attorney fees. The remaining members of the class (collectively, the "Haggarts"), oppose the Woodleys through their class counsel. Although it failed to take a formal position below, on appeal the Government takes the position that class counsel improperly refused to disclose information necessary to allow class members to assess the fairness and reasonableness of the proposed settlement. This court has jurisdiction under 28 U.S.C. § 1295(a)(3) (2012).
Before we address the merits of the Woodleys' claim, we are presented with multiple threshold issues. First, the Haggarts contend the Government lacks standing and thus cannot challenge the approved settlement and award of attorney fees.
I. The Government Has Standing to Challenge the Claims Court's Award of Attorney Fees Under the Common Fund Doctrine
The Haggarts contend that the Government lacks standing to seek review of "any issues pertaining to [c]lass [c]ounsel's recovery of attorney fees" because it lacks "any cognizable interests at stake that could support this [c]ourt's jurisdiction to review those issues." Haggart Br. 14 (citing Lujan v. Defs. of Wildlife, 504 U.S. 555, 560, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992)). In support of this argument, the Haggarts cite to the Claims Court decision in Geneva Rock Products, Inc. v. United States, in which the court determined that because "no class member has objected to the [attorney] fee award and ... neither the [G]overnment's liability nor its susceptibility to damages is in any way contingent on, or affected by, the amount of attorney fees awarded apart from the statutory fee," the Government cannot establish standing to challenge the contingent fee. 119 Fed.Cl. 581, 593 (2015) (citations omitted).
Unlike the class members in Geneva Rock, here the Woodleys have objected to the attorney fee award. Also, the line of cases relied on by the Claims Court distinguish between the losing party's ability to challenge attorney fees to be paid from a common fund as opposed to a statutory fee. See Copeland v. Marshall, 641 F.2d 880, 905 n. 57 (D.C.Cir.1980) ("[W]here the prevailing party's fees are paid by the loser pursuant to statute ... the losing party ... retains an interest in contesting the size of the fee. This is not the case in `common fund' fee litigation." (emphasis added)).
The Government possesses an institutional interest in assuring that courts do not abrogate Congress's intent by impermissibly substituting the common fund doctrine in place of a fee-shifting statute like the URA when awarding attorney fees. See Freeman v. Ryan, 408 F.2d 1204, 1206 (D.C.Cir.1968) ("Where litigation
Because Congress intended the URA to assure that plaintiffs in inverse-condemnation actions obtain just compensation for their property taken by the Government by requiring that the Government pay plaintiffs' reasonable attorney fees, see Florida Rock Industries v. United States, 9 Cl.Ct. 285, 291 (1985) ("The Act thus entitles a plaintiff to be made whole for expenses incurred in achieving victory"), the Government has an interest "in seeing that [the attorney fees] it owes to litigants are disbursed properly." Allen, 606 F.2d at 434.
II. The Government's Arguments Are Not Barred by Waiver or Judicial Estoppel
The Haggarts contend the Government should not be allowed to "disavow th[e] settlement [agreement] ..., based upon concerns that it could have raised, but did not raise, with [the Claims] [C]ourt." Haggart Br. 15. The Haggarts assert that during the fairness hearing, "[t]he [Government]  sat mute on the disclosure issue. Instead, it emphasized the `arduous process' that produced the settlement and defended [the settlement agreement] as `fair, reasonable[,] and adequate.'" Id. at 16. (brackets and citations omitted). As to the attorney fee award, they contend the Government "affirmatively disclaimed any interest in the matter, both in response to [c]lass [c]ounsel's fee motion and at the fairness hearing." Id. Thus, "[b]ecause the [Government] failed to raise these issues below," the Haggarts contend we should find them waived. Id. at 17.
The Government acknowledges that it "did not take a position below on the adequacy of [c]lass [c]ounsel's disclosures or its motion for additional fees." Government Reply Br. 3. However, with respect to the settlement agreement, it claims that it "assumed that [c]lass [c]ounsel had fulfilled its obligation to provide the owners relevant information," until the fairness hearing when the Woodleys "provided additional information about their communications with [c]lass [c]ounsel." Government Br. 19. On the basis of this information, the Government contends it "determined that [c]lass [c]ounsel improperly refused to
We are not bound to accept the Government's confession nor does it relieve us of our obligation to examine independently the errors confessed. See Young v. United States, 315 U.S. 257, 258-59, 62 S.Ct. 510, 86 L.Ed. 832 (1942). Nevertheless, the Supreme Court has held that the Government's assertion that reversible error has been committed is "entitled to great weight," id. at 258, 62 S.Ct. 510, and that "candid reversal of its position is commendable," Orloff v. Willoughby, 345 U.S. 83, 87, 73 S.Ct. 534, 97 L.Ed. 842 (1953); see also Ramos v. Dep't of Justice, 552 F.3d 1356, 1358 (Fed.Cir.2009) (accepting the Government's confession of error). Because the Government's "error [should] not [be] penalized by precluding [its] subsequent assertion of the truth," we find that the Government should be allowed to put forth its arguments. Konstantinidis v. Chen, 626 F.2d 933, 939 (D.C.Cir.1980).
B. Judicial Estoppel
The facts of this case render the Haggarts' judicial estoppel arguments untenable.
Although the Haggarts contend "[a]ll of [the factors in Monsanto] are present" in this case, they nonetheless concede the Government "raised no issues about [the inadequate disclosures] in the joint motion seeking approval of the settlement or at the fairness hearing." Haggart Br. 18
The Haggarts do not contend the arguments made by the Government before the Claims Court contradict those made before this court because there was no precise argument proffered by the Government either before the Claims Court or in the fairness hearing. The Government's only attempt to do so was with regard to its assertion that the settlement agreement was "fair, reasonable[,] and adequate." Id. at 16 (brackets omitted) (quoting S.A. 545-46). However, acquiescence that the settlement agreement in total was fair, reasonable, and adequate is not inconsistent with the Government's current assertion that class counsel failed to provide adequate disclosure of how the settlement agreement was distributed among every individual class member.
Because the Government has not presented arguments at variance with its earlier contention, none of the three factors articulated in Monsanto are present in the case before us. Therefore, the Government's arguments are not barred by judicial estoppel.
III. Class Counsel Failed to Disclose How It Calculated the Individual Compensation Amounts
We review the Claims Court's "legal holdings de novo and examine [its] factual findings for clear error." Banks v. United States, 741 F.3d 1268, 1275 (Fed. Cir.2014) (citing Bell BCI Co. v. United States, 570 F.3d 1337, 1340 (Fed.Cir.2009)). As to the Claims Court's approval of a class action settlement agreement, we review its determination that the agreement was fair, reasonable, and adequate for abuse of discretion. See In re Cendant Corp. Litig., 264 F.3d 201, 231 (3d Cir. 2001); see also In re Gen. Motors Corp. Engine Interchange Litig., 594 F.2d 1106, 1124 (7th Cir.1979)
The Government contends "[c]lass [c]ounsel improperly refused to disclose information necessary to evaluate the methodology for valuing the compensation proposed to be paid to each class member, and this refusal deprived class members of the ability to evaluate the fairness and reasonableness of the proposed settlement." Government Br. 19. The Woodleys
The Haggarts contend the Claims Court "determined that class members had sufficient information concerning their individual settlement amounts, including the appraisals." Haggart Br. 27. They argue the Government and the Woodleys "fail to cite any authority supporting their argument that [c]lass [c]ounsel had a duty separate and apart from [RCFC] Rule 23(e)(1)[
We recognize that notice need not "contain a formula for calculating individual awards" or provide a "complete source of information." Petrovic v. Amoco Oil Co., 200 F.3d 1140, 1153 (8th Cir.1999) (quoting DeBoer v. Mellon Mortg. Co., 64 F.3d 1171, 1176 (8th Cir.1995)); see also William B. Rubenstein, Newberg on Class Actions § 8:17 (5th ed. 2015) ("Newberg") ("[N]otice need not be overly long and stuffed with every relevant bit of information, and parties are not always strictly bound to the language approved by the court." (footnotes omitted)). However, because notices are often general and need not encompass all relevant details, it is crucial that class counsel allow class members to "easily acquire more detailed information" should they choose to do so. Petrovic, 200 F.3d at 1153; see also Fought v. Am. Home Shield Corp., 668 F.3d 1233, 1240 (11th Cir.2011) (approving settlement agreement because the notice provided "instructions for accessing a website established for the purpose of providing additional information regarding the proposed settlement"); Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1797.6 (3d ed. 2004) ("[C]ourts have approved notices that did not contain some of the precise details of the settlement, such as the distribution or allocation plan, or the amount of attorney fees to be taken out, as long as sufficient contact information is provided to allow the class members to obtain more detailed information about those matters." (footnotes omitted)); Manual for Complex Litigation, Fourth, § 21.312 (2004) ("Manual") (stating that notice should "prominently display the address and phone number of class counsel and how to make inquiries").
Despite the Haggarts' attempt to frame it as such, this case does not concern the notice provided by class counsel to class members outlining the details of the settlement agreement. Rather, it is rooted in the Woodleys' request for additional information concerning the methodology class counsel employed in calculating the fair market value of unappraised properties. Courts have rarely had an opportunity to assess counsel's provision of additional information concerning a settlement agreement due to the proliferation of the use of easily-accessible mediums, such as the Internet, which permits class members to evaluate the agreement in greater detail. See Newberg § 8:17 at 283 ("[A]s the Internet develops, it is easy, and relatively costless, to provide class members free access to a set of documents in the lawsuit at settlement, not just to a synopsis describing the settlement.... Given the ease of making this material available to class members, courts may become increasing[ly] wary of settlements that fail to do so."); see also In re Pet Food Prods. Liab. Litig., 629 F.3d 333, 339-40 (3d Cir.2010) ("[A] settlement website [was] established, through which class members could obtain additional information and copies of settlement documents.")
The Claims Court may approve a settlement proposal "only after a hearing and on finding that it is `fair, reasonable, and adequate.'" RCFC 23(e)(2). Although typically articulated in the context of challenges to formal court-approved notices of settlement under Rule
In this case, due to the large number of individual properties, class counsel and the class appraiser divided the properties into three distinct categories: (1) "unique" properties; (2) "representative" properties; and (3) "nonrepresentative" properties. See Haggart IV, 116 Fed.Cl. at 136. Properties characterized as unique "did not share enough common valuation features with any other properties directly appraised," thus their fair market values were "directly determined by an appraisal for that specific property." Id. Similarly, with respect to representative properties, determination of the parcels' fair market value was also based on a direct appraisal of the property. The only parcels not individually appraised were nonrepresentative parcels. In calculating the fair market values of non-representative parcels, the properties were divided into twenty-two groups and within each group, representative parcels were chosen to serve as proxies for the properties in the group based on a myriad of factors such as "common use, zoning, similar location, and other significant features with the other properties in the subgroup." J.A. 85.
Full disclosure of the precise methodology employed in arriving at the value of non-representative properties is especially important in this context because of the various inputs used in calculating the fair market value of unappraised properties and the significant discrepancy in the allocation of the final property values. See S.A. 403-17 (proposed compensation ranged from $444.45 to more than $2.4 million). Where inequities in treatment exist among class members, class counsel must provide members with sufficient information justifying any disparate treatment. See Vassalle v. Midland Funding LLC, 708 F.3d 747, 755 n. 1 (6th Cir.2013) (reversing the district court's approval of proposed settlement agreement and stating that "[e]ven if they were not disproportionate, we would still hold the inequities in treatment here are unfair because the record contains no justification for these inequities").
Because the fair market values of non-representative parcels were extrapolated from one of twenty-two representative groups, determinations of the fair market values of non-representative properties must have been derived from some
Class counsel also asserts that it provided "the portion of the spreadsheet concerning each class member's parcel." Haggart Br. 35. However, this information does not constitute "necessary information for any class member to become fully apprised and make any relevant decision." See Katrina, 628 F.3d at 198 (citation omitted). A relevant decision could not have been made by any class member whose property was not directly appraised. Mere examination of the spreadsheet detailing the fair market value of the property provides no guidance or insight in determining whether the property value is fair, reasonable, and adequate because necessary information such as the articulation of the variables and other inputs from which the fair market value was derived was not provided. See Manual § 21.312 (Class counsel must "explain the procedures for allocating and distributing settlement funds, and, if the settlement provides different kinds of relief for different categories of class members, clearly set forth those variations.").
We recognize receipt of only three objections from a class of 253 members militates in favor of approval of the settlement agreement.
With respect to the Haggarts' contention that class counsel "explained the methodology for determining the individual settlement amounts," Haggart Br. 35, apart from documents provided in the notice to the class, class counsel did not provide any additional documents such as the spreadsheets detailing the precise methodology used to calculate the fair market value of the properties that would have placed the Woodleys and other class members in a position to determine for themselves whether the allocation of the settlement agreement was fair, reasonable, and adequate, see S.A. 548 (Mrs. Woodley asserting during the fairness hearing that "[w]e would just like to see [the appraisal documentation].... The appraisal starting point, the spreadsheets, the calculations. We've never seen them. [Class counsel] talked about it, briefly, but we've never seen it."); see also Manual § 21.312 (Asserting that class counsel must "provide information that will enable class members to calculate or at least estimate their individual recoveries." (emphasis added)).
Mere provision of the final values of the unappraised properties, without more, cannot render the settlement agreement "fair, reasonable, and adequate." RCFC 23(e)(2). Moreover, under the Washington Rules of Professional Conduct ("RPC"), class counsel owes a fiduciary duty to his clients to furnish such information. See Washington RPC 1.4(a)(4) ("A lawyer shall: promptly comply with reasonable requests for information."). We see no reason why under these facts class counsel can or should deny his clients access to the physical copy of information which they are entitled to receive. Otherwise, effective representation of the class members' interests cannot occur. See Weinberger v. Kendrick, 698 F.2d 61, 74 (2d Cir.1982) (stating that to achieve "effective representation of the class's interests," the provision of adequate information includes allowing "access to materials produced in discovery" (citations omitted)).
The Claims Court erred in approving a settlement agreement where class counsel withheld critical information not provided in the mailed notice to class members, but which had been produced and was readily available. Thus, the court abused its discretion by failing to consider the accessibility or availability of information necessary for the Woodleys and other class members to make an informed decision about the settlement agreement. See In re Bank of Am. Corp. Sec., Derivative, & Emp. Ret. Income Sec. Act (ERISA) Litig., 772 F.3d 125, 132 (2d Cir.2014) (in a class action suit, a court abuses or exceeds the discretion accorded to it when "its decision—though not necessarily the product of a legal error or a clearly erroneous factual finding—cannot be located within the range of permissible decisions" (internal quotation marks and citation omitted)); see also Eastway Constr. Corp. v. City of N.Y., 821 F.2d 121, 123 (2d Cir.1987) ("All discretion is to be exercised within reasonable limits. The concept of discretion implies that a decision is lawful at any point within the outer limits of the range of choices appropriate to the issue at hand; at the same time, a decision outside those limits exceeds or, as it is infelicitously said, `abuses' allowable discretion." (citations omitted)).
IV. The Common Fund Doctrine
We now turn to the Claims Court's award of attorney fees under the
Our analysis requires three steps. First, we address whether the circumstances of this case creates a common fund. We then address whether the common fund doctrine is applicable under RCFC 23 class actions. Finally, we determine whether an attorney may recover attorney fees under the common fund doctrine in lieu of reasonable attorney fees provided by the URA. We take each of these issues in turn.
A. A Common Fund Exists
The Woodleys and the Government assert that, contrary to the Claims Court's determination, "[t]here is no common fund." Woodley Br. 12. Specifically, the Government argues that "[t]he bundling of individual payments so [c]lass [c]ounsel can conveniently collect fees cannot transform separate payments into a `common fund' entitling [c]lass [c]ounsel to common-fund fees." Government Br. 38.
In response, the Haggarts argue that the Woodleys and the Government's contention that the Claims Court's "award was merely a `bundling' of individual claims is  puzzling" because "[a]ll class actions, and hence all class action settlements, are necessarily a bundling of individual claims." Haggart Br. 41.
The issue here is whether the circumstances of this case create a common fund. Although often collapsed by courts into a single analysis, as we explain in greater detail below, the question of whether a common fund has been created is distinct from whether the doctrine may be applied to allow class counsel or the prevailing litigant to recover attorney fees. See Brytus v. Spang & Co., 203 F.3d 238, 243 (3d Cir.2000) ("[T]he fact that a common fund has been created does not mean that the common fund doctrine must be applied in awarding attorney's fees."). Recovery of attorney fees under a common fund is based on the existence of some inequity borne by counsel or the successful litigant. See id. at 246. Conversely, whether a common fund exists concerns whether the $110 million settlement agreement to be distributed to class members may be so characterized. See Knight v. United States, 982 F.2d 1573, 1582 (Fed.Cir.1993).
Although the historical origins of the common fund doctrine suggests it was primarily applied to decisions involving express trusts in which there was a clearly defined trust fund, see Greenough, 105 U.S. at 527; Pettus, 113 U.S. at 127, 5 S.Ct. 387, it has also been applied where the creation of the fund is prospective and has yet to be made formally available to individuals who are similarly situated, see Sprague v. Ticonic Nat'l Bank, 307 U.S. 161, 167, 59 S.Ct. 777, 83 L.Ed. 1184
The Woodleys and the Government argue that because the individual appraisal values must first be determined, then summed before arriving at the $110 million settlement, this is substantively distinct from first determining the aggregate amount of the fund, then from this total, apportioning individual claims. However, predicating the creation of a common fund on the order in which the settlement agreement was calculated would yield an untenable distinction not contemplated by any prevailing Supreme Court precedent. The determination of a total settlement agreement is always derived from the aggregation of some underlying individual claim. Moreover, limiting the common fund doctrine to exclude the discrete bundling of individual awards would unduly narrow the application of the doctrine, which is expressly designed to give courts the power to equitably spread costs. See Sprague, 307 U.S. at 167, 59 S.Ct. 777.
Our decision finds support from the Ninth Circuit, which has allowed the creation of putative or hypothetical funds by aggregating the amount a defendant would pay in damages to members of the class under the settlement agreement. See Staton v. Boeing Co., 327 F.3d 938, 972 (9th Cir.2003); see also id. at 971 n. 21 ("The description of the total amount of the [common] fund need not take any particular form and could result from adding up separately-enumerated amounts in the agreement."). Thus, we hold the circumstances in this case create a common fund.
B. The Common Fund Doctrine is Applicable to RCFC 23 Class Actions
Because we find a common fund exists, we turn to the applicability of the common fund doctrine to RCFC 23 class actions. That is a question of law subject to de novo review. See Capital Bancshares Inc. v. Fed. Deposit Ins. Corp., 957 F.2d 203, 209 (5th Cir.1992).
The Government argues that even if we were to find that the "settlement created a `common fund,' the common-fund doctrine still does not apply because there are no non-clients who benefit from class counsels' efforts in [RCFC 23] class-actions."
In response, the Haggarts argue the circumstances of this case render the application of the common fund doctrine apposite. Specifically, the Haggarts assert that "[c]lass [c]ounsel obtained a sizeable recovery that benefits all of the class members, and equity demands that all class members contribute to [class] [c]ounsel's
The Government's contention that, because RCFC 23 requires potential class members to opt-in to the class, there can be "no non-clients who benefit from class counsels' efforts," Government Br. 38, presents a distinction without a difference. Here, class counsel initially had a thirty-five percent contingency fee agreement with some class members before the class was certified. Haggart IV, 116 Fed.Cl. at 137-38. However, upon certification of the class, "although all class members were made aware of the agreement," class counsel did "not have a fee agreement with all of the class members." Haggart Br. 42 (emphasis added). Thus, the fact that these members opted-in and were therefore "parties" to the litigation is irrelevant. Rather, in considering the application of the common fund doctrine, the relevant question is whether an inequity exists. See Boeing Co., 444 U.S. at 478, 100 S.Ct. 745. Of the 253 class members entitled to compensation, we count only sixty-eight members as signing the contingency-fee agreement. Although 253 individuals opted-in to the class, it is clear that 185 (approximately 73%) of those members are not differently situated from absentees in a FRCP 23(b)(3) class action because they were not contractually obligated to contribute to the payment of attorney fees incurred on their behalves. Thus, contrary to the Government's assertion, what matters is not whether "counsel in RCFC 23 class actions can enter into agreements with each member at the opt-in stage," but whether he actually did. Government Br. 40 (emphases added).
Here, because 185 class members did not sign the contingency fee agreement, they were not contractually obligated to contribute to the costs of the litigation. Thus, before considering how the URA impacts the application of the common fund doctrine, at this point in our discussion, it is clear that some inequity exists, at least with respect to sixty-eight members of the class. Ascribing significance to the fact that the remaining 185 members "opted-in" and were therefore parties to the litigation elevates form over substance. See Sprague, 307 U.S. at 167, 59 S.Ct. 777 ("[T]he formalities of the litigation... hardly touch the power of equity in doing justice as between a party and the beneficiaries of his litigation.").
C. Recovery of Attorney Fees Under the Common Fund Doctrine Is Preempted by the URA
We turn to whether the presence of the URA resolves the inequity. That is, we consider whether class counsel can recover attorney fees under the common fund doctrine in lieu of the URA, which provides class counsel with reasonable attorney fees. We review the determination of reasonable attorney fees for abuse of discretion. See Bywaters, 670 F.3d at 1228; Hall v. Sec'y of Health & Human Servs., 640 F.3d 1351, 1356 (Fed. Cir.2011). However, errors of law in the award of attorney fees are corrected without deference. See Bywaters, 670 F.3d at 1228-34; Brytus, 203 F.3d at 244.
Congress has determined that in certain cases the prevailing parties may recover their attorney fees from the opposing
In common fund cases, district courts have applied the lodestar method to determine the amount of attorney fees. See In re Wash. Pub. Power Supply Sys. Sec. Litig., 19 F.3d 1291, 1299 (9th Cir. 1994). However, unlike statutory fee-shifting cases, in common fund cases, courts have applied a risk multiplier when using the lodestar approach.
The URA is a fee-shifting statute and provides for the award of "reasonable" attorney fees in two distinct circumstances. First, attorney fees may be awarded where the Government begins a condemnation proceeding resulting in either a final judgment that the Government may not acquire the property by condemnation or abandonment of the proceeding by the Government. See 42 U.S.C. § 4654(a)(1)-(2); see also Bywaters, 670 F.3d at 1227. Second, attorney fees may also be granted where, as in the case before us, a landowner brings an inverse condemnation action under the Tucker Act or the Little Tucker Act alleging a Government taking under the Fifth Amendment and that action results in an award of compensation for the taking. See id.; 42 U.S.C. § 4654(c).
The Government argues that "applying [a common fund] to a judgment specifying a sum certain for every party/client when the attorney will receive a reasonable statutory fee [under the URA] stretches the doctrine beyond all recognition." Government Br. 32. According to the Government, because "[f]ederal fee-shifting statutes, including the URA, ... provide for defendants to pay `reasonable' fees[,][a]n additional fee is by definition unreasonable
The Haggarts assert the Supreme Court's decision in Venegas v. Mitchell is controlling because it "did not preclude recovery of additional attorney[ ] fees under a contingency fee contract." Haggart Br. 44 (citing 495 U.S. 82, 90, 110 S.Ct. 1679, 109 L.Ed.2d 74 (1990)). According to the Haggarts, "[t]he teaching of Venegas is that fee-shifting statutes do not regulate what clients pay their lawyers, and do not cap or limit the amount of fees that lawyers can collect." Id. at 45. Thus, the Haggarts contend "the URA does not address or regulate what plaintiffs are to pay [c]lass [c]ounsel, and does not impose any constraint on the [Claims Court's] inherent equitable authority to award common-fund fees." Id. at 45-46.
The Claims Court defined the common fund to include the principal amount and interest. Haggart IV, 116 Fed.Cl. at 144. However, it rejected the Haggarts' contention that the statutory attorney fees of $1,920,000, calculated using the lodestar method, must be included as part of the common fund. Id. ("[H]ere the contingent fee percentage should be applied to the principal and interest, not also to the amount of statutory fees."). The court found "that the common fund consists of $137,961,218.69 ($110,000,000 in principal [plus] $27,961,218.69 in interest)." Id. at 148.
As to whether class counsel's request for thirty percent of the common fund was reasonable, the Claims Court looked to factors it has previously applied in determining the percentage of recovery. Id. at 145. The court ultimately used a scaled methodology and, from the $110 million the Government agreed to pay, "award[ed] class counsel 30% of the first $50 million, 25% of the next $50 million, and 20% of all monies over $100 million." Id. at 148. Thus, the court awarded class counsel fees totaling $35,092,243.74. Id. Finally, because class counsel retained the agreed statutory fee, the court awarded class members "a dollar-for-dollar credit for the statutory fee paid by the [G]overnment in the amount of $1,920,000, [thus] reducing the amount of the attorney[ ] fees to paid out of the common fund to $33,172,243.74.
The fact that a common fund has been created is not sufficient to establish a finding that the common fund doctrine must be applied when awarding attorney fees, an assertion implicit in the Haggarts' argument. See Brytus, 203 F.3d at 243. Rather, recovery under the common fund doctrine derives from the equitable power of courts to create the obligation for attorney fees against benefits received as a result of the advocacy of another. Knight, 982 F.2d at 1580. Thus, recovery requires the existence of an inequitable outcome, which in turn requires redressability.
We begin our analysis by noting that, contrary to the Haggarts' contention and the Claims Court's determination, Venegas does not govern the case before us. See Haggart IV, 116 Fed.Cl. at 148 n. 18 (stating that "to disallow a contingent fee in this case would be contrary to [Venegas]"). In Venegas, the Supreme Court held a statute authorizing payment of reasonable attorney fees to prevailing civil rights plaintiffs does not invalidate contingent fee contracts that would require a prevailing plaintiff to pay his attorney more than the statutory award against
The URA expressly allows landowners to retain the full compensation of the value of their property by mandating the Government to assume the litigation expenses of counsel in bringing forth the takings claim. See 42 U.S.C. § 4654(c); (asserting that plaintiff shall be awarded "such sum as will in the opinion of the court or the Attorney General reimburse such plaintiff for his ... reasonable attorney ... fees"); see also URA Legislative History, S.1, Senate Floor Remarks, Congressional Record, Senate, 115 Cong. Rec. 31533 (Oct. 27, 1969), Uniform Relocation Assistance and Land Acquisition Policies Act of 1969 ("Transactions must be carried out in a manner that will assure that the person whose property is taken is no worse off economically than before the property was taken."). Under the URA, it is the Government, as opposed to class counsel or another member of the plaintiff class, who bears the reasonable cost of the action; thus, the inequity that would otherwise result is expressly addressed by the statute. In the presence of the URA, we find no inequity to redress. The sine qua non of the common fund doctrine is that some inequity must exist. Without inequity, class counsel cannot attempt to augment reasonable attorney fees by substituting the application of the doctrine in place of the URA. Such an action not only undermines the purpose of the URA, see Milwaukee v. Illinois & Michigan, 451 U.S. 304, 314, 101 S.Ct. 1784, 68 L.Ed.2d 114 (1981) ("[W]hen Congress addresses a question previously governed by a decision rested on federal common law[,] the need for such an unusual exercise of lawmaking by federal courts disappears."), but also unjustly enriches class counsel at the expense of class members, a result diametric to the primary purpose of the common fund doctrine, see Greenough, 105 U.S. at 532; see also Tex. v. Pankey, 441 F.2d 236, 241 (10th Cir.1971) (asserting that federal common law applies "[u]ntil the field has been made the subject of comprehensive legislation or authorized administrative standards").
Our decision finds support in Supreme Court holdings concerning the intersection of law and equity. In Petrella v. Metro-Goldwyn-Mayer, Inc., the Court found that the common law equitable doctrine of laches is inapplicable when Congress has, through statute, filled the void the common law doctrine was intended to address.
Finally, the Haggarts point to the Ninth Circuit's decision in Staton, which held that statutory fee-shifting and the equitable common fund doctrine operate differently and should be treated separately as support for their contention that the common fund doctrine may be applied in the presence of a fee-shifting statute. See Staton, 327 F.3d at 967. Staton also held that "unless Congress has forbidden the application of the common fund doctrine in cases in which attorneys could potentially recover fees under the type of fee-shifting statute[ ] [,] [ ] courts retain their equitable power to award common fund attorney[ ] fees." Id. at 968 (citing Alyeska Pipeline, 421 U.S. at 257-59, 95 S.Ct. 1612). However, the Seventh Circuit in Pierce v. Visteon Corp., limited the common fund doctrine to cases "outside the scope of a fee-shifting statute."
We agree with the Seventh Circuit. The fact that Congress did not expressly abjure the common fund doctrine in enacting the URA is not dispositive. See Petrella, 134 S.Ct. at 1975 (asserting that equity "can scarcely be described as a rule for interpreting a statutory prescription"). What is more, we agree with the Pierce court's determination that permitting class counsel to recover in the presence of fee-shifting statutes similar to the URA contravenes the Supreme Court's decision in Dague. See Pierce, 791 F.3d at 787. In Dague, the Court held that, in calculating a reasonable fee under fee-shifting statutes like the URA, district courts should not include a multiplier that effectively compensates class counsel for risk of loss. See 505 U.S. at 562, 112 S.Ct. 2638 ("We note at the outset that an enhancement for contingency would likely duplicate in substantial part factors already subsumed in the lodestar."). However, similar to the contingent fee agreement addressed in Dague, allowing class counsel to recover under a common fund would operate in precisely the same manner because, like a contingent fee agreement, "[a] common-fund
We do not foreclose the application of the common fund doctrine in all instances in which a fee-shifting statute is present. Equity may sometimes deem it appropriate to give counsel a piece of either the final judgment or settlement agreement. See id. (positing that it may "sometimes [be] appropriate to give ... [counsel] a slice of the class's recovery on top of a fee-shifting award"); see also Brytus, 203 F.3d at 247 ("This is not to say that the common fund doctrine may never be applied in a case for which there is a statutory fee provision...."). At its heart, equity is about fairness. See Petrella, 134 S.Ct. at 1977 (asserting that equity may still intervene to address a party's conduct in certain circumstances).
In the present case, the URA provision was expressly enacted with the primary purpose of rendering property owners whole and fee recovery is governed by statute. The URA provides a reasonable fee and thus forecloses application of the common fund doctrine.
We reverse the Claims Court's approval of the settlement agreement and award of attorney fees under the common fund doctrine and remand for further consideration consistent with the foregoing. The Claims Court's decision is
Government Br. 21 (footnote omitted).
The term "Roeder deed" was established in The Roeder Co. v. Burlington Northern, Inc., where the Supreme Court of Washington, sitting en banc, described it as "a deed [that] refers to the right of way as a boundary but also gives a metes and bounds description of the abutting property." 105 Wn.2d 567, 577, 716 P.2d 855 (Wash.1986) (en banc).
42 U.S.C. § 4654(c).