Opinion
No. 98 Civ. 7161 (VM).
June 22, 2005
DECISION AND ORDER
By Order dated March 9, 2005, following a grant of plaintiffs' motion for summary judgment, the Court authorized entry of judgment in an amount of $36,617,696.00 in favor of the plaintiff class in this action against defendants Garth Drabinsky ("Drabinsky") and Myron Gottlieb ("Gottlieb"). A judgment (the "Judgment") in that amount was entered on March 21, 2005. Lead plaintiffs' counsel filed a motion requesting a prospective award of attorneys fees and expenses in an amount of 25 percent of any funds recovered for the class in satisfaction of the Judgment.
The Court established a deadline of May 27, 2005 for submission of any objections by shareholders to the attorneys' fees application. Lead plaintiffs' counsel report that only two objections were filed, copies of which were forwarded to the Court. Having fully considered the request and the objections thereto, the Court is persuaded that the application is reasonable and that the motion should be approved.
In connection with the settlement of the claims of the plaintiffs' class against other defendants in this action, the Court previously determined that awards of attorneys fees of 25 percent of the amounts recovered was reasonable. Unlike those settlements, however, the Judgment against Drabinsky and Gottlieb required litigation of a motion for summary judgment and is not immediately recoverable. Moreover, the Court's ruling is the subject of a pending appeal. Even if plaintiffs prevailed on appeal, enforcement proceedings against Drabinsky and Gottlieb would have to proceed in Canada, where they reside and where any substantial assets they may own are presumably located. As counsel point out, it is conceivable that Drabinsky and Gottlieb may have no assets sufficient to satisfy the Judgment, and even if they did there is likely to be significant competition for recovery against any such assets as a result of other legal proceedings against Drabinsky and Gottlieb in Canada. All of these circumstances amount to substantial additional expenditures, risk and delays for lead plaintiffs' counsel in pursuing enforcement of the Judgment on behalf of the members of the class, and justify approval of the application. Accordingly, it is hereby
ORDERED that the application of counsel for lead plaintiffs herein for an award of attorneys fees and expenses in an amount of twenty-five percent of any funds recovered by the plaintiff class from the judgment the Court entered on March 21, 2005 against defendants Garth Drabinsky and Myron Gottlieb is GRANTED.
SO ORDERED.