Apple requests disqualification of Compliance Monitor, citing inappropriate financial stake and exorbitant hourly rate

Posted on February 19th, 2014 by Legal Fee Advisors

When is an excessive fee still considered “fair”? Apparently, to some, it can be if the lawyer is court-appointed. Defendant Apple has asked that attorney Michael Bromwich be removed from his position as external compliance monitor in an ongoing e-books antitrust suit, objecting to the attorney’s excessive hourly rate and “financial interest in the proceedings.”[1] Michael Bromwich, a partner at Goodwin & Proctor, was assigned by a Southern District Judge in September, 2013 to monitor Apple’s policies and procedure for compliance with anti-trust laws.[2] Apple first sought to stay the injunction ordering the monitor in December of last year. After the U.S. government filed its opposition to the motion, Apple filed a reply on January 7^th of 2014, requesting that Bromwich be disqualified.

In its reply, Apple first takes issue with the fact that Bromwich filed a declaration in support of the government’s response. Apple argues that Bromwich’s “open opposition to Apple” and relationship with the plaintiff, prevent him from serving as an impartial monitor. Further, according to Apple, Bromwich’s refusal to set any limits on the scope of his work or adopt a fee structure, reflect his self-proclaimed “goal of generating profits.” The reply also repeats Apple’s complaint, made in its original motion to stay the injunction, that Bromwich’s hourly rate of $1,100 is unreasonably excessive: “serving as a court imposed monitor is a form of public service and should not be treated as a profit-making enterprise governed by standards that apply when companies consensually retain lawyers of their choice in the private sector.”[3]

The September court order also requires Apple to pay the fees of an additional anti-trust attorney assigned to assist in monitoring, as Bromwich is not an anti-trust expert. His hourly rate is $1025. And added on top of that is a 15% administrative fee. [4]

As Apple points out, there is no opportunity to recover the fees paid to the attorneys, even if the company prevails on appeal. Thus, they have reason to fear that millions of dollars in fees could be incurred by the end of the suit, especially in light of the fact that within only the first two weeks of work, Bromwich’s invoice came to $138,432.00.[5]  This latest action in the pending case visits the questionability of unrestricted attorney’s fees in the context of court ordered investigations: should parties be forced to bear costs equaling or even exceeding those contracted for with private firms?

E. Biblelnieks

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