[00:00:00] Speaker 04:
All right, let's get started with we have one case today with this panel, and then we'll swap panels and commence with the rest of the cases a few minutes after the conclusion of this one.

[00:00:12] Speaker 04:
Our first case is 24-6227 Chieftain Royalty Company versus Entervest Energy.

[00:00:19] Speaker 04:
And starting with the opponent, is it Mr. Pence first?

[00:00:23] Speaker 05:
Your honor, we spoke yesterday and agreed that Mr. Isaacson will go first.

[00:00:28] Speaker 05:
Okay.

[00:00:28] Speaker 01:
And that I will follow.

[00:00:29] Speaker 05:
Thank you.

[00:00:30] Speaker 01:
All right.

[00:00:31] Speaker 01:
Good morning, your honor.

[00:00:32] Speaker 01:
May I piece with the court?

[00:00:34] Speaker 01:
Eric Allen, Isaacson.

[00:00:36] Speaker 01:
I hope to take about five minutes to make some points.

[00:00:40] Speaker 01:
Mr. Pence and I are united in the belief that the fee award in this case is excessive, although our approach to the issues are a little bit different.

[00:00:49] Speaker 04:
Who's your client again?

[00:00:50] Speaker 01:
My client is C. Benjamin Nutley as trustee for the Nutley estate.

[00:00:56] Speaker 01:
And the case is one that's been around for quite a while.

[00:01:00] Speaker 01:
I think the initial settlement and fee award were back in 2015.

[00:01:04] Speaker 01:
Judge Digesti awarded one third of the common fund as attorney's fees, despite the fact that class counsel did not state their precise time and were unwilling to document it.

[00:01:16] Speaker 01:
In fact, said they didn't keep time records.

[00:01:18] Speaker 01:
This court reversed saying you've got to apply state law, Oklahoma Supreme Court law, on attorney's fees and it looks like the Oklahoma Supreme Court requires a lodestar analysis.

[00:01:32] Speaker 01:
It remanded and the Oklahoma Supreme Court in another case called Strach said, yeah, we require a lodestar analysis.

[00:01:40] Speaker 01:
The question in that case was whether attorney's fees in a common fund can be determined on the basis of percentage of the fund or lodestar.

[00:01:48] Speaker 01:
The court says, you know, percentage of the fund and lodestar both are useful.

[00:01:53] Speaker 01:
You can start with one or the other, but it's important that it be reasonable and you've got to check one against the other.

[00:01:59] Speaker 01:
The Oklahoma Supreme Court said,

[00:02:01] Speaker 01:
that there's a strong presumption that the load star, the unenhanced load star, is sufficient.

[00:02:08] Speaker 01:
And it checked the fee award in that case against the unenhanced load star and said, whoa, it's way above that.

[00:02:15] Speaker 01:
That's suspicious.

[00:02:17] Speaker 01:
It also said that percentage awards can be reasonable if they're between

[00:02:21] Speaker 01:
20% and 30% in a complex Common Fund litigation.

[00:02:26] Speaker 01:
The median is 25%.

[00:02:28] Speaker 01:
Let's check the fee in this case against 25% and again the fee was way above what the attorneys would have gotten with a 25% fee award.

[00:02:40] Speaker 01:
What was Judge Digesti's approach?

[00:02:42] Speaker 01:
Was it to follow Stratt and analyze the case first in terms of the lodestar amount and the amount that a 25% fee award would produce?

[00:02:53] Speaker 01:
No, he reaffirmed his original one-third of the fund and he did it without following what Stratt says you got to do.

[00:03:02] Speaker 01:
Stratt says, check it against the lodestar, check it against 25%.

[00:03:06] Speaker 04:
Didn't he do that?

[00:03:10] Speaker 04:
Essentially, is your argument that Strach is a hard cap?

[00:03:17] Speaker 04:
What's the number?

[00:03:18] Speaker 01:
No, I don't think Strach is necessarily a hard cap, but Strach says we rarely approve of a fee award above 1.5.

[00:03:26] Speaker 01:
You recognized in your descent, partial descent from the last time the case was up, that the load star is, there's a strong presumption that the load star is sufficient.

[00:03:37] Speaker 01:
and that the lodestar amount is objective.

[00:03:41] Speaker 01:
Well, if there's a strong presumption that the unenhanced lodestar is sufficient, there's got to be a pretty strong explanation to deviate upwards.

[00:03:50] Speaker 01:
And the Oklahoma Supreme Court says, we rarely have approved a lodestar multiplier more than 1.5.

[00:03:57] Speaker 01:
The lodestar multiplier in this case is lots more than 1.5.

[00:04:00] Speaker 04:
What's the inadequacy then in Judge Dujuski's explanation?

[00:04:07] Speaker 04:
If there's if there's some Delta where you can vary upward from the strike range.

[00:04:13] Speaker 04:
What why did why was the court's explanation of his rationale.

[00:04:18] Speaker 04:
inadequate here.

[00:04:20] Speaker 04:
Abusive discretion.

[00:04:22] Speaker 01:
The explanation of its rationale was inadequate for a number of reasons.

[00:04:26] Speaker 01:
One, it didn't recognize that it's a truly strong presumption that should be rarely departed from, and it was basically backing into to justify the original one-third fee award, rather than starting with the Oklahoma Supreme Court's presumptions.

[00:04:42] Speaker 01:
And it also was applying the multiplier to a much larger lodestar than was warranted.

[00:04:50] Speaker 01:
It was an $8 million ward star as calculated by the court.

[00:04:54] Speaker 01:
Mr. Pence has some reasons to think that the lodestar was a lot closer to $5 million, if you wanted to calculate it legitimately.

[00:05:01] Speaker 01:
And I'd like, if I could, to reserve some time for rebuttal, like three minutes for Mr. Pence and myself both, and to cede the floor to Mr. Pence to talk about the lodestar.

[00:05:11] Speaker 04:
All right.

[00:05:11] Speaker 04:
Thank you, Mr. Pence.

[00:05:12] Speaker 04:
Go ahead.

[00:05:13] Speaker 05:
Thank you, Your Honors.

[00:05:14] Speaker 05:
John Pence on behalf of Appellant Danny George.

[00:05:18] Speaker 05:
The parties are in agreement now that STRAC is the definitive statement of Oklahoma law on the award of attorney's fees in a class action.

[00:05:25] Speaker 05:
And obviously, to the extent that STRAC conflicts with the prior case of Burke, STRAC would control.

[00:05:32] Speaker 05:
But in fact, there is no conflict with the STRAC standard

[00:05:36] Speaker 05:
and Burke can easily be explained based on the new standard that time is properly included in Lodestar.

[00:05:44] Speaker 05:
And what we're really asking there is that when we were asking, can you include it in Lodestar, we're asking is it properly chargeable to the class?

[00:05:51] Speaker 05:
It's includeable in Lodestar when it's helpful to the litigation.

[00:05:54] Speaker 05:
And the class council in Burke was indeed, did indeed meet that standard.

[00:06:00] Speaker 05:
First and foremost, class council in Burke did submit his Lodestar data.

[00:06:05] Speaker 05:
Now, the court did overcompensate him there without showing its work, but as class counsel, he had no control over what the court was going to do once he submitted his lodestar.

[00:06:16] Speaker 05:
Furthermore, there was no Oklahoma law on the award of attorneys fees in the class action at that time.

[00:06:21] Speaker 05:
Burke was the case that kind of established the law that it's based on lodestar in Oklahoma and that lodestar multipliers are modest.

[00:06:30] Speaker 05:
They really do exceed 1.5.

[00:06:33] Speaker 02:
Can I ask you about that, Mr. Pence?

[00:06:35] Speaker 02:
And you and Mr. Isaacson have referred to Justice Winchester's discussion about 1.5.

[00:06:41] Speaker 02:
Is that a soft cap or whatever you call it, guidepost to remain in perpetuity?

[00:06:53] Speaker 02:
Justice Winchester was referring to the reported cases as of the time that he issued the opinion.

[00:07:00] Speaker 02:
in STRAC.

[00:07:02] Speaker 02:
So let's say in five years, does that mean that we will again be confronted with, say, a multiplier of 1.85 or 2.15 that Judge DiGiusti had and say, well, Justice Winchester said back in 2021, based on the reported cases that he was looking at, that any multiplier over 1.5 is rarely to be, not never, but rarely to be approved.

[00:07:30] Speaker 02:
How long do we subscribe to this benchmark in light of the fact that he was relying on historical information?

[00:07:39] Speaker 05:
Well, Your Honor, I would say at least in this case, the strong similarity between Strack and this case, they were both gas royalty class actions.

[00:07:48] Speaker 05:
They were both hard.

[00:07:49] Speaker 05:
Well, the Strack court found that that case was very desirable, that it presented low risk, but that they did a good job and that there was no penalty implied in that fee award.

[00:08:00] Speaker 05:
They were not penalizing class counsel for making any error or mistake.

[00:08:05] Speaker 05:
Unlike here where class counsel committed malpractice and made a frivolous argument to the district court.

[00:08:12] Speaker 05:
When class counsel failed to submit any lodestar data in connection with their 2015 fee petition, the following three years of appeal were just a waste of time.

[00:08:24] Speaker 05:
And it's wrong to charge the class for class counsel's malpractice

[00:08:29] Speaker 05:
in failing to submit its low star data in 2015.

[00:08:33] Speaker 05:
And then, you know, to double down by going scorched earth on the appeal, taking it all the way up to the Supreme Court.

[00:08:41] Speaker 05:
When the question presented was simply, you know, what law applies in a diversity class action, and the answer to that has been state law ever since Erie.

[00:08:50] Speaker 05:
So the amount of time the class council wasted

[00:08:55] Speaker 05:
on that first appeal.

[00:08:58] Speaker 05:
They're the ones that should have to bear that time.

[00:09:01] Speaker 05:
It was for their own

[00:09:02] Speaker 05:
They were chasing their own attorney's fee that, by the way, the fact that the fee that Judge De Juicy has awarded 33% each time, three different times, doesn't cure that first fee award.

[00:09:15] Speaker 05:
That was wrong when made.

[00:09:16] Speaker 05:
That initial 33% fee award represented a 3.46 multiplier, and there is simply no way, getting back to your question,

[00:09:26] Speaker 05:
judge backer act there's no way you're going to square that with with anything that was set in strack i mean that was clearly beyond the pale we may get a multiplier of two or two point five but

[00:09:40] Speaker 02:
That's water under the bridge.

[00:09:42] Speaker 02:
I mean, that was reversed.

[00:09:44] Speaker 02:
Here we are, you know, based on, let's say, let's go to Chieftain II in where Justice Giusti, now Mr. Isaacson referred to, you know, and I understand one criticism is that maybe he started with a 2.15 multiplier rather than starting freshly.

[00:10:02] Speaker 02:
But, you know, putting that argument aside,

[00:10:06] Speaker 02:
Judge DiGiusti didn't make the error that you're referring to in Chieftain 1 here, now that we are in Chieftain 3.

[00:10:14] Speaker 02:
He did purport to rely on the statutory factors that is consonant with Justice Winchester's opinion in Strach.

[00:10:24] Speaker 02:
Now, one could argue that I don't remember in Justice Winchester referring to low risk.

[00:10:31] Speaker 02:
I do remember he said that these large royalty cases in Oklahoma are attractive to firms, which is true here.

[00:10:40] Speaker 02:
But one of the statutory factors is results obtained.

[00:10:44] Speaker 02:
And we don't know from Strach what was that $56 million award of the Common Fund in comparison to the claim

[00:10:53] Speaker 02:
to the claimed amount.

[00:10:55] Speaker 02:
And why isn't it reasonable here for Judge DiGiusti to say, well, an award of 52 to $55 million based on the very limited upside for statutory interest, that factor results obtained that is required to be considered was enough to justify his exercise of discretion.

[00:11:20] Speaker 02:
Why doesn't that differentiate Strack

[00:11:23] Speaker 02:
And why do we have to find an abuse of discretion?

[00:11:28] Speaker 05:
Well, my response to that would be because of the limiting factor of the lodestar analysis.

[00:11:34] Speaker 05:
You know, perhaps Judge Dujusny has a basis for exceeding the 25% benchmark here because of what he views as 100% recovery.

[00:11:43] Speaker 05:
But Stratt cautions that you have to also compare that to what would be produced by the lodestar method.

[00:11:49] Speaker 05:
And because I believe that

[00:11:52] Speaker 05:
None of that time spent on Chieftain One, which after all was an incorrect decision when made and the fact that it's now been kind of cured by the inclusion of that three million, I mean it's kind of a circular question.

[00:12:05] Speaker 05:
We don't believe that that three million should be chargeable to the class and it ends up being 6.4 million when it's multiplied by 2.15 because that was

[00:12:15] Speaker 05:
You know, this court even said it in Chieftain one.

[00:12:17] Speaker 05:
They said, you know, we wish class council had done their homework on Oklahoma law.

[00:12:21] Speaker 05:
And that, that simply means putting in some Lodestar data.

[00:12:25] Speaker 02:
But if that had been done... Judge Hartz, I think was referring to keeping contemporaneous data.

[00:12:32] Speaker 02:
Judge DiGiusti found that the reconstruction of the data is reasonable.

[00:12:36] Speaker 02:
I think we're bound by the clear error standard.

[00:12:39] Speaker 02:
So I don't know why that dicta in Chieftain one.

[00:12:43] Speaker 02:
would preclude us from finding that Judge DiGiusti didn't commit clear error in approving the reconstructed time records.

[00:12:52] Speaker 04:
Judge Kelly, your speaker's off if you wanted to ask a question.

[00:12:57] Speaker 03:
Well, I can't see anybody.

[00:12:59] Speaker 03:
There's something wrong with the presentation.

[00:13:03] Speaker 03:
Can you hear?

[00:13:04] Speaker 03:
I can hear.

[00:13:08] Speaker 05:
My final point would be that I'm aware that this court

[00:13:12] Speaker 05:
awarded time to the lead planet based on time he spent reviewing those briefs and chieftain one, but there's a difference between, you know, not wanting to penalize the lead planet for doing something he was asked to do by his council.

[00:13:25] Speaker 05:
And he didn't really know, you know, I doubt he was aware of the Oklahoma fee law in class council who should have been aware of that.

[00:13:35] Speaker 05:
And who should, who could have avoided all of that time, all of that lodestar,

[00:13:39] Speaker 05:
if they had simply presented their lodestar in connection with their 2015 fee petition.

[00:13:45] Speaker 05:
And unless you have any further questions, I'll... Yeah, you wanted to read it for some time, for sure.

[00:13:53] Speaker 04:
Okay.

[00:13:53] Speaker 04:
Okay.

[00:13:56] Speaker 04:
Let's hear from Mr. Beckworth.

[00:13:59] Speaker 00:
May it please the court?

[00:14:01] Speaker 00:
Your honors, I'm Brad Beckworth, and I am one of the members of the class council here, so we'll be arguing on behalf of

[00:14:09] Speaker 00:
ourselves as the appellee This case was filed in 2011 when I was 39 years old.

[00:14:15] Speaker 00:
I'm now 53 Judge Tim convention we've been before you at least once in this case, so it's good to see Charles Dickens could use this case for a plot

[00:14:26] Speaker 00:
I agree, and I hope that this will be the last of it.

[00:14:32] Speaker 00:
Importantly, this is the first time that Judge DiGiusti's opinion on the fee issue will be looked at on the actual merits.

[00:14:40] Speaker 00:
And two of his prior decisions have come before this court on the merits.

[00:14:46] Speaker 00:
And when that has happened, he's been affirmed.

[00:14:48] Speaker 00:
One was the decision about whether the settlement should be approved and he should reject the attack against the settlement by these objectors.

[00:14:57] Speaker 00:
That was affirmed in Chieftain One when we went to Rehearing on Bonk.

[00:15:01] Speaker 00:
And then in Chieftain Two, his merits-based decision on the incentive fee award was approved on the merits or affirmed on the merits.

[00:15:09] Speaker 00:
So here, I think we're down to a singular issue.

[00:15:12] Speaker 00:
And that issue is, did Judge De Juiste act within his discretion when he followed this court's mandate and followed Strach to apply that law to the facts of this case and find that a fee percentage of 31.5% was appropriate in the face of a $55 million settlement?

[00:15:34] Speaker 00:
And the answer to that is, yes, he exercised his discretion and acted within it.

[00:15:39] Speaker 00:
Just stopping there for one second to be very clear, the fee award is 31.5% of the settlement value, which is undisputed.

[00:15:48] Speaker 00:
This idea that it's a third is a little confusing because it's a third of the cash, but the fee award is 31.5% and that's reflected in Judge Adjusti's most recent order.

[00:15:59] Speaker 02:
Mr. Beckworth, let me test that.

[00:16:01] Speaker 02:
Now, you say that he was entitled to go upward to 31.5 percent.

[00:16:10] Speaker 02:
In Justice Winchester's opinion on page 617, he talks about the normal range of the percentage of 20 to 30 percent.

[00:16:22] Speaker 02:
But interestingly, the opinion has a very specific trigger point

[00:16:28] Speaker 02:
for varying from that benchmark, and it's a prepositional phrase, with deviations from that range when the fund is extraordinarily large or small relative to the hours of work expended by the attorneys.

[00:16:45] Speaker 02:
That follows a discussion saying that when the common fund is unusually large, there's economies of scale, which would suggest that the percentage should be lower, not higher.

[00:16:57] Speaker 02:
And there, of course, we were talking about a common fund and strike of $56 million.

[00:17:02] Speaker 02:
Here we're talking about either $52 or $55 million.

[00:17:06] Speaker 02:
So I didn't see anything in Judge DiGiusti's opinions, any of those opinions, to suggest that he was going to 31.5% or 33%, whatever you call it, based on deviations because the fund is extraordinarily large or small relative to the work expended.

[00:17:27] Speaker 02:
If he had followed that, presumably he would be going below the 20 to 30 percent benchmark, not above it.

[00:17:36] Speaker 00:
Your Honor, let me respond to that, and I respectfully disagree on several levels.

[00:17:40] Speaker 00:
First, I know you're surprised by that.

[00:17:44] Speaker 00:
First, you have to go back and look at what happened in Stratt.

[00:17:48] Speaker 00:
And we were amici in that case.

[00:17:50] Speaker 00:
We've tried a lot of the oil and gas cases in Oklahoma.

[00:17:53] Speaker 00:
And in fact, we won a firmance on a verdict against Sanoco on Monday from this court.

[00:18:00] Speaker 00:
the defense lawyer in that case, a trial, was the objector in STRAC.

[00:18:04] Speaker 00:
So we're very familiar with it.

[00:18:05] Speaker 00:
What happened in STRAC was pretty straightforward.

[00:18:08] Speaker 00:
There was a 40% fee contract, and the trial court extended that contract and said 40% was the class rep fee, 40% should be the fee in the case.

[00:18:19] Speaker 00:
And when you go through the STRAC opinion, it's very clear that what the Supreme Court had trouble with was the court didn't go through the Johnson factors, or 2023 factors, as they're called in Oklahoma.

[00:18:30] Speaker 00:
Now, if you go back to what happened with Judge DiGiusti here, he did it right the first time.

[00:18:34] Speaker 00:
We asked for a 40% fee.

[00:18:36] Speaker 00:
His original opinion in 2015 says, I'm not going to just carry that fee forward.

[00:18:41] Speaker 00:
I'm going to go and do a full sum Johnson factor 2023 analysis of all the factors.

[00:18:48] Speaker 00:
And he decided to downward depart from 40% to a third or 31.5.

[00:18:54] Speaker 00:
So that's the first answer to that.

[00:18:56] Speaker 00:
Secondly, when you look at

[00:18:58] Speaker 00:
What I think what you're pointing to is economies of scale.

[00:19:02] Speaker 00:
I do a lot of this.

[00:19:03] Speaker 00:
You're talking about mega fund cases.

[00:19:05] Speaker 00:
If it's a billion dollar fund, then sometimes it's so out of whack if you had a load star of, say, $5 million.

[00:19:12] Speaker 00:
But that's not what happened here.

[00:19:14] Speaker 00:
In Oklahoma, just like in your opinions and take Volgaris, for example, which really Strach and Volgaris are on all fours, the idea is to get to a reasonable defeat.

[00:19:25] Speaker 00:
And either the district court has discretion or he doesn't.

[00:19:29] Speaker 00:
And when you have a range, that means you have discretion.

[00:19:33] Speaker 00:
Here, most importantly, differing from Strach is we had 100% recovery.

[00:19:39] Speaker 00:
I know that's true because I did it and our expert report on that is not disputed was 100% recovery.

[00:19:49] Speaker 00:
That is the most important factor in Oklahoma on any court analysis, whether it's a low star.

[00:19:54] Speaker 00:
or a percentage of the fee.

[00:19:57] Speaker 00:
The second most important thing is award in similar cases.

[00:20:00] Speaker 00:
And Judge Timkovich, when you look at Chieftain II, for example, that panel looked at awards in similar cases for the class representative.

[00:20:09] Speaker 00:
The same is true here.

[00:20:11] Speaker 00:
This record is full of expert opinions by trial court judges and scholars and practitioners that say both before and after strike, 40% is really the common fee in cases no matter how big they are in Oklahoma.

[00:20:26] Speaker 00:
Yes, sir.

[00:20:27] Speaker 02:
Yeah, but the problem with that, Mr. Beckworth, is Judge Hetherington, Professor Gensler, Judge Burrage,

[00:20:35] Speaker 02:
Dan Little, all of those affidavits were filed three years before STRAC was even decided.

[00:20:42] Speaker 02:
And none of those rely on state district court rulings three years before Justice Winchester confronted exactly the same sort of analysis and said, we have a 40%

[00:20:59] Speaker 02:
a benchmark that should be applied for this common fund fee award.

[00:21:06] Speaker 02:
And Justice Winchester said not.

[00:21:08] Speaker 02:
State district courts in Oklahoma and the 77 counties have rarely approved it.

[00:21:13] Speaker 02:
We, the Oklahoma Supreme Court, have rarely approved it and in fact expressly repudiated, rejected a 40% percentage award.

[00:21:24] Speaker 02:
And so I don't know why the

[00:21:28] Speaker 02:
affidavits, none of which included a single settlement or fee award more recently than three years before STRAC was decided, would justify us deviating from this 20 to 30 percent benchmark.

[00:21:50] Speaker 02:
So, Judge Degusti seems to have made just a factual error by crediting those affidavits, all of which preceded STRAC.

[00:21:59] Speaker 02:
Well, Your Honor, I'm sorry, go ahead.

[00:22:02] Speaker 02:
No, I just say, what am I missing?

[00:22:04] Speaker 02:
I might be missing something.

[00:22:05] Speaker 00:
Sure, I believe you are with all due respect.

[00:22:08] Speaker 00:
First, let's be clear about Strack.

[00:22:09] Speaker 00:
It's not a starburst opinion.

[00:22:12] Speaker 00:
Strack didn't say this is new law.

[00:22:13] Speaker 00:
Strack says we're looking at what the law is and applying it to the facts of this specific case.

[00:22:18] Speaker 00:
Again, courts either have discretion or they don't.

[00:22:22] Speaker 00:
Strack cited this court's opinion in Brown.

[00:22:25] Speaker 00:
This court also cited Brown in vulgaris.

[00:22:30] Speaker 00:
In vulgaris, the objector tried to do exactly what they tried to do here and say, oh, if you look at this court's opinion in Gottlieb, there was a 25% benchmark because the court in Gottlieb talked about 25%.

[00:22:42] Speaker 00:
This court said, no, that's not right.

[00:22:44] Speaker 00:
We didn't adopt a benchmark.

[00:22:46] Speaker 00:
The range is what it is.

[00:22:47] Speaker 00:
In Brown, it can be high or low.

[00:22:49] Speaker 00:
That's exactly what happened this track.

[00:22:51] Speaker 00:
They didn't adopt a benchmark in that case.

[00:22:53] Speaker 00:
Nothing of the sort.

[00:22:55] Speaker 00:
They cited a range.

[00:22:56] Speaker 00:
They cited this court's range.

[00:22:59] Speaker 00:
That's what it is.

[00:22:59] Speaker 00:
And in Brown, it goes up to 37%.

[00:23:01] Speaker 00:
Now, let's go back to your point about who filed those declarations.

[00:23:05] Speaker 00:
It's correct, but also not correct, because we submitted evidence to the court of post-track decisions.

[00:23:12] Speaker 00:
They're in our briefs here.

[00:23:13] Speaker 00:
They're in the record.

[00:23:14] Speaker 00:
One of them is, for example, Judge Heaton.

[00:23:16] Speaker 02:
But Judge Heaton was applying a stipulation that applied federal common law, not Oklahoma law.

[00:23:22] Speaker 00:
But he looked at what has been happening since.

[00:23:27] Speaker 00:
It's absolutely what he did.

[00:23:28] Speaker 00:
And you could look at, we've put them in the record, a lot of those are our cases.

[00:23:32] Speaker 00:
There is discretion and a range.

[00:23:35] Speaker 00:
We're really quibbling over 1.5% here.

[00:23:38] Speaker 00:
With a judge who has had this case for over 10 years,

[00:23:42] Speaker 00:
This court's precedent says we don't go hunting for error, that we give discretion to a judge who has been in a case.

[00:23:50] Speaker 00:
Y'all's opinion in Syngenta is one example of that.

[00:23:53] Speaker 00:
Judge Holmes wrote, I think, that opinion.

[00:23:56] Speaker 00:
This judge knows this case.

[00:23:58] Speaker 00:
And let's go back and talk about the record that was before him.

[00:24:02] Speaker 00:
Those lawyers and judges didn't just look at a percentage, Your Honor.

[00:24:06] Speaker 00:
That's not what they did.

[00:24:08] Speaker 00:
They looked at the time records.

[00:24:09] Speaker 00:
They looked at the low star.

[00:24:12] Speaker 00:
They looked at the result achieved.

[00:24:13] Speaker 00:
They looked at similar awards in other cases.

[00:24:16] Speaker 00:
That's the one you just asked about.

[00:24:18] Speaker 00:
But there's 13 factors.

[00:24:20] Speaker 00:
And that wasn't just some light group of experts.

[00:24:23] Speaker 00:
That was Michael Burge.

[00:24:25] Speaker 00:
I think many of you know him.

[00:24:26] Speaker 00:
That was Pat Ryan, my co-counsel in Sonoco, who just passed away.

[00:24:29] Speaker 02:
Well, we may think that they're, you know, the most brilliant individuals of the planet, but I don't know that we can, you know, affirm based on the fact that we have high regard, you know, for the credibility of the experts.

[00:24:43] Speaker 02:
The problem, I think, is that they're relying on language without analyses that were without

[00:24:52] Speaker 02:
knowledge that three years later that Justice Winchester would allow only a limited exception when the deviations from that range are when the fund is extraordinarily large or small relative to the hours of work expended by the attorneys.

[00:25:09] Speaker 02:
So maybe Justice Winchester was wrong, but I don't know how we can just ignore that based on a higher regard for the credibility of your experts.

[00:25:19] Speaker 00:
Well, Your Honor, I'm not asking you to ignore it.

[00:25:22] Speaker 00:
I'm asking you to do what Strach says.

[00:25:24] Speaker 00:
This court said we had to follow Oklahoma Supreme Court law, and Oklahoma Supreme Court says that judges have discretion, and that you have to look at the unique facts before the court.

[00:25:33] Speaker 00:
Strach was a case where certification was denied,

[00:25:36] Speaker 00:
Strack was a case where they did not get 100% of damages.

[00:25:39] Speaker 00:
And one thing, if you look at that opinion carefully, which is clearly you have, there was another $3 million that they were going to get there on top of what was at issue in the $19 million fee award.

[00:25:49] Speaker 00:
I know those lawyers very well.

[00:25:51] Speaker 00:
I know exactly what happened there because, again, we analyzed it and filed the amicus briefs in that case.

[00:25:55] Speaker 00:
It's not the same case.

[00:25:57] Speaker 00:
We got 100% here.

[00:25:59] Speaker 00:
And if you're going to do a low star cross check, which is what they're saying is required,

[00:26:05] Speaker 00:
Then let's do the Lodestar cross check, but let's also do it as Judge DiGiusti did twice.

[00:26:11] Speaker 00:
He did it two times, one on the percentage and one on the fee amount.

[00:26:16] Speaker 04:
What's your response to the claim that you failed to provide Lodestar data early on, which dragged out Chieftain One and really created maybe an unnecessary appeal?

[00:26:31] Speaker 00:
Well, Your Honor, I have several responses to it.

[00:26:34] Speaker 00:
One, there was a strategic reason, and two, the objectors have misled this court all along.

[00:26:39] Speaker 00:
They're still doing it.

[00:26:41] Speaker 00:
I was the one they were pointing to there.

[00:26:44] Speaker 00:
I never said, and we've given you the full record, I never said that we didn't have time records.

[00:26:49] Speaker 00:
I said that I personally didn't keep them.

[00:26:51] Speaker 00:
I'm one of many here.

[00:26:52] Speaker 00:
We did, and I said we do have time records.

[00:26:56] Speaker 00:
and you have those time records before you, the issue of whether they were submitted was very simple.

[00:27:01] Speaker 00:
At the time, there was no Oklahoma court that said you had to do a load start.

[00:27:06] Speaker 00:
If you look at Strat, I think we should do one, but the law should, not must.

[00:27:11] Speaker 00:
That's what it says.

[00:27:12] Speaker 00:
We were following Oklahoma State Court and federal jurisprudence and relying on prior authority here.

[00:27:19] Speaker 00:
But there was also a strategic reason, Your Honor.

[00:27:22] Speaker 00:
We, and Judge De Juiste, pointed to this.

[00:27:24] Speaker 00:
We had a case that originally this case was SM.

[00:27:28] Speaker 00:
Intervest bought some of the wells.

[00:27:30] Speaker 00:
We were in hot litigation against SM.

[00:27:32] Speaker 00:
We did not want to submit time records that our adversaries in that case could see and gain an advantage of.

[00:27:39] Speaker 00:
And that carried forward even after we went back and put our time records in, which is why there was redactions and we originally allowed to put them under seal.

[00:27:45] Speaker 00:
But we produce time records and I think it's critically important going back to Judge Backer's comments about who these judges were and whether you respect them or not.

[00:27:54] Speaker 00:
Judge Van Dyke tried more Oklahoma oil and gas cases than any other judge as a state court judge.

[00:28:00] Speaker 00:
Judge Hetherington tried our opioid case.

[00:28:03] Speaker 00:
He tried the tobacco case.

[00:28:05] Speaker 00:
These are judges that practice in Oklahoma both as lawyers and as judges, and they know the fee law there, and they know the unique circumstances of our case and our work in these cases.

[00:28:17] Speaker 00:
And I think Judge DiGiusti was entirely allowed to rely upon these experts.

[00:28:22] Speaker 00:
And I should mention that none of their factual findings were challenged.

[00:28:26] Speaker 00:
They objected to using certain experts, Justice Watt and Glenn Coffey, who wrote 2023.

[00:28:34] Speaker 00:
But Judge DiGiusti struck those.

[00:28:36] Speaker 00:
Everyone else, he said, look, this goes to the weight of my analysis.

[00:28:39] Speaker 00:
And, Your Honors, it was in his discretion to rely on that.

[00:28:42] Speaker 04:
Well, before you sit down, I also was concerned that the appeal to the United States Supreme Court looks pretty dubious to me.

[00:28:51] Speaker 04:
And I guess the fee award would include the cost of that issue to the Supreme Court.

[00:29:01] Speaker 04:
No, you're shaking your head.

[00:29:03] Speaker 00:
Yes, sir.

[00:29:04] Speaker 00:
May I continue to see my time's up?

[00:29:06] Speaker 04:
Yeah, go ahead and answer my question.

[00:29:07] Speaker 00:
Yes.

[00:29:08] Speaker 00:
It's very clear and judged to deduce this order and in our declaration that none of that time was submitted seeking cert.

[00:29:14] Speaker 00:
None of it.

[00:29:16] Speaker 00:
Right.

[00:29:16] Speaker 00:
What we submitted was through the rehearing en banc, and I think we were preparing cert at the time that we submitted our fee declarations.

[00:29:28] Speaker 00:
So that's not included in there.

[00:29:32] Speaker 04:
What the en banc petition of the 10th circuit would be?

[00:29:35] Speaker 00:
Yes, your honor.

[00:29:36] Speaker 00:
And let's go back to that.

[00:29:38] Speaker 00:
They attacked.

[00:29:40] Speaker 00:
the settlement.

[00:29:41] Speaker 00:
And when the 10th Circuit issued Chieftain 1, it did not affirm the settlement.

[00:29:46] Speaker 00:
And part of our effort in rehearing en banc was to get that clarified.

[00:29:50] Speaker 00:
The court did not grant rehearing, but it's Sue Espante issued a, non pro-tunk I guess is what it was called, to clarify that the settlement was indeed affirmed.

[00:30:00] Speaker 00:
That's critical if I may just continue because

[00:30:03] Speaker 00:
Intervest went to bankruptcy and had that order not have been won by us against their attack, this class would have gotten nothing.

[00:30:13] Speaker 00:
We would have gone into an adversarial proceeding.

[00:30:15] Speaker 00:
Let me just check what I said, make sure I said it right.

[00:30:17] Speaker 04:
Yeah, go ahead and do that and then wrap up.

[00:30:21] Speaker 00:
Okay, that's correct.

[00:30:23] Speaker 00:
The time that we spent drafting the cert petition was included, but we also put in there several hundred hours about what would happen if cert was granted.

[00:30:32] Speaker 00:
That was not included.

[00:30:34] Speaker 00:
We just showed it, but Judge DiGiusti made clear he didn't consider it, nor did we request it.

[00:30:39] Speaker 00:
So I wanna make sure I got that exactly right.

[00:30:41] Speaker 04:
All right.

[00:30:42] Speaker 04:
Thank you.

[00:30:42] Speaker 04:
Thank you, Mr. Beckberg.

[00:30:43] Speaker 04:
We can hear either Mr. Isaacson or Mr. Pence.

[00:30:46] Speaker 01:
So getting it exactly right, he concedes that time put into the cert petition was in fact included in the load star.

[00:30:54] Speaker 01:
I think that you focused on whether the 1.5 is a hard cap.

[00:31:00] Speaker 01:
It's pretty firm.

[00:31:03] Speaker 01:
I think it's supposed to be pretty firm.

[00:31:04] Speaker 01:
And whether it can change over time, I think you would want to look at reported Oklahoma decisions, not unreported district court opinions that are applying a federal common law.

[00:31:16] Speaker 01:
The original decision in this case from the 10th Circuit rejected the idea that a federal common law controls here.

[00:31:24] Speaker 01:
It said apply Oklahoma law, and Oklahoma law is what Strach says.

[00:31:29] Speaker 01:
Now Strach has been applied in one published Oklahoma decision called Folsom where the court said the results achieved were extraordinary and it reduced the fee award from a multiplier of 3 to a multiplier of 1.3.

[00:31:47] Speaker 01:
That's well under the 1.5.

[00:31:50] Speaker 01:
A multiplier of 1.5 in this case would generate a fee award of $12 million, not $17.3 million.

[00:31:57] Speaker 01:
A 25% fee award in this case would generate a fee of $13 million, not $17.3 million.

[00:32:05] Speaker 01:
$17.3 million was way too much.

[00:32:12] Speaker 01:
And we want to go back and look at the reconstructed time records.

[00:32:17] Speaker 01:
I think Mr. Beckworth did say that they didn't keep time records.

[00:32:20] Speaker 01:
And it turns out that what was put in for many of the time records were daily time slips with the name of the case having Entervest.

[00:32:27] Speaker 01:
The case was filed in 2011 in Oklahoma State Court and removed to federal court.

[00:32:32] Speaker 01:
Entervest was not added until September of 2024 on the eve of settlement.

[00:32:38] Speaker 01:
So those time slips

[00:32:40] Speaker 01:
We're all bogus.

[00:32:42] Speaker 01:
They're all reconstructed after the fact on the daily basis with the wrong case name on them.

[00:32:47] Speaker 04:
Did you raise that in the district court?

[00:32:50] Speaker 01:
Yes, we raised that argument in the district court.

[00:32:52] Speaker 01:
We filed a motion.

[00:32:53] Speaker 01:
Natalie filed a motion to strike the time records and the judge

[00:32:57] Speaker 01:
rejected the motion, he denied the motion, and given the abusive discretion standard, that didn't seem like the strongest point to be making on appeal, to take an appeal from striking those time records.

[00:33:10] Speaker 01:
But the fact of the matter is that Mr. Beckworth and his colleagues did not keep time records for the most part.

[00:33:17] Speaker 01:
The time records were reconstructed, and that is absolutely clear from the record.

[00:33:22] Speaker 04:
Your time's over.

[00:33:25] Speaker 01:
Go ahead and finish up.

[00:33:27] Speaker 01:
I'd like to finish up.

[00:33:28] Speaker 01:
I apologize to Mr. Pence if I've taken his rebuttal time.

[00:33:32] Speaker 04:
All right.

[00:33:32] Speaker 04:
Well, I think you did, but Mr. Pence, I'll give you 60 seconds if you want.

[00:33:37] Speaker 05:
Thank you, Your Honor.

[00:33:38] Speaker 05:
I appreciate that.

[00:33:39] Speaker 05:
I believe I heard Mr. Beckworth say that in 2015, there was no Oklahoma court, this is an exact quote, that said you had to do load stock.

[00:33:49] Speaker 05:
I mean, even Judge DeJuiste said in his opinion that if we need to follow Oklahoma law, we don't have enough information to make a fee award right now.

[00:33:59] Speaker 05:
I don't know how Mr. Beckworth could possibly say that.

[00:34:02] Speaker 05:
It was clearly required then.

[00:34:04] Speaker 05:
His argument then was we don't have to follow Oklahoma law.

[00:34:08] Speaker 05:
We can follow this federal common law that he apparently still believes in, but he believes

[00:34:12] Speaker 05:
that what constitutes federal common law are these unreported decisions where you basically stipulate around the law of Oklahoma and they never see the light of day.

[00:34:25] Speaker 05:
But the law that governed was the law announced in Burke and then confirmed in Strack, which is you have to produce your lodestar, which is why everything, the class council invited the error that required and led to Chieftain One

[00:34:41] Speaker 05:
and they shouldn't be able to charge the class for that.

[00:34:44] Speaker 04:
All right, thank you, Council.

[00:34:46] Speaker 04:
I think we understand and appreciate your arguments.

[00:34:49] Speaker 04:
Council, our excused and the case will be submitted.

[00:34:51] Speaker 04:
This panel will be adjourned and will reconvene in about 60 to 120 seconds.

[00:34:59] Speaker 04:
Thank you.

[00:35:00] Speaker 03:
Thank you.