Case 4:19-cv-03074-YGR Document 467 Filed 02/28/22 Page 1 of 6
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`THEODORE J. BOUTROUS JR., SBN 132099
`tboutrous@gibsondunn.com
`RICHARD J. DOREN, SBN 124666
` rdoren@gibsondunn.com
`DANIEL G. SWANSON, SBN 116556
`dswanson@gibsondunn.com
`JAY P. SRINIVASAN, SBN 181471
` jsrinivasan@gibsondunn.com
`GIBSON, DUNN & CRUTCHER LLP
`333 South Grand Avenue Los Angeles, CA 90071
`Telephone: 213.229.7000
`Facsimile: 213.229.7520
`
`VERONICA S. MOYÉ (Texas Bar No.
`24000092; pro hac vice)
` vmoye@gibsondunn.com
`GIBSON, DUNN & CRUTCHER LLP
`2100 McKinney Avenue, Suite 1100
`Dallas, TX 75201
`Telephone: 214.698.3100
`Facsimile: 214.571.2900
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`
`
`MARK A. PERRY, SBN 212532
` mperry@gibsondunn.com
`CYNTHIA E. RICHMAN (D.C. Bar No.
`492089; pro hac vice)
` crichman@gibsondunn.com
`GIBSON, DUNN & CRUTCHER LLP
`1050 Connecticut Avenue, N.W.
`Washington, DC 20036
`Telephone: 202.955.8500
`Facsimile: 202.467.0539
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`ETHAN D. DETTMER, SBN 196046
`edettmer@gibsondunn.com
`RACHEL S. BRASS, SBN 219301
`rbrass@gibsondunn.com
`CAELI A. HIGNEY, SBN 268644
` chigney@gibsondunn.com
`GIBSON, DUNN & CRUTCHER LLP
`555 Mission Street
`San Francisco, CA 94105
`Telephone: 415.393.8200
`Facsimile: 415.393.8306
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`Attorneys for Defendant Apple Inc.
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`UNITED STATES DISTRICT COURT
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`FOR THE NORTHERN DISTRICT OF CALIFORNIA
`OAKLAND DIVISION
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`DONALD R. CAMERON, et al.,
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`Plaintiffs
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`v.
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`APPLE INC.,
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`Defendant.
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` Case No. 4:19-cv-03074-YGR
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`DEFENDANT APPLE INC.’S RESPONSE
`TO DEVELOPER PLAINTIFFS’ MOTION
`FOR ATTORNEYS’ FEES,
`REIMBURSEMENT OF EXPENSES, AND
`SERVICE AWARDS
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`The Honorable Yvonne Gonzalez Rogers
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`DEFENDANT APPLE INC.’S RESPONSE TO DEVELOPER PLAINTIFFS’ MOTION FOR ATTORNEYS’ FEES,
`REIMBURSEMENT OF EXPENSES, AND SERVICE AWARDS
`No. 4:19-cv-03074-YGR
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`Case 4:19-cv-03074-YGR Document 467 Filed 02/28/22 Page 2 of 6
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`Pursuant to Local Rule 7-3(b), Defendant Apple Inc. (“Apple”) respectfully submits this
`Response regarding the application for fees and expenses, Dkt. 465, made by Plaintiffs’ counsel in
`connection with the proposed settlement in this action. In total, Plaintiffs’ counsel are seeking fees and
`costs that constitute 30.5 percent of the $100 million Small Developer Assistance Fund established by
`the settlement. They seek 27 percent of that amount for attorneys’ fees, which equals more than 200
`percent of their lodestar investment. While Apple takes no issue with the expenses or service awards
`sought by Plaintiffs, the fee request is high by the standards applied in this Circuit and District. See,
`e.g., In re Bluetooth Headset Prod. Liab. Litig., 654 F.3d 935, 941–42 (9th Cir. 2011) (“[C]ourts
`typically calculate 25% of the fund as the ‘benchmark’ for a reasonable fee award, providing adequate
`explanation in the record of any ‘special circumstances’ justifying a departure.”); Haralson v. U.S.
`Aviation Servs. Corp., 2021 WL 5033832, at *7 (N.D. Cal. Feb. 3, 2021) (“Courts in the Ninth Circuit
`generally start with the 25 percent benchmark and adjust upward or downward”). While Apple
`ultimately does not oppose the fee request, Apple notes that the Court has discretion to award a different
`amount as appropriate. In re Bluetooth Headset Prod. Liab. Litig., 654 F.3d at 942.
`At the outset, Apple entirely agrees with Plaintiffs’ counsel that the terms of the settlement
`confer substantial benefits—monetary and non-monetary—on the members of the settlement class,
`who comprise more than 99 percent of U.S. app developers. In addition to the $100 million non-
`reversionary cash fund to assist small developers, Apple has made a series of commitments to structural
`changes that will benefit all developers worldwide for at least three years after final approval.
`Specifically, some of the key benefits provided by the settlement to the developer community include:
`(1) Small business program maintenance. Apple will maintain a commission rate of no
`greater than 15% for U.S. developers who are enrolled participants in the Small Business
`Program, subject to program participation requirements.
`(2) Search and discovery. Apple will commit to drive search results by a variety of factors
`that will give new and high-quality apps a chance to be found.
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`DEFENDANT APPLE INC.’S RESPONSE TO DEVELOPER PLAINTIFFS’ MOTION FOR ATTORNEYS’ FEES,
`REIMBURSEMENT OF EXPENSES, AND SERVICE AWARDS
`No. 4:19-cv-03074-YGR
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`Case 4:19-cv-03074-YGR Document 467 Filed 02/28/22 Page 3 of 6
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`(3) Communication. Apple will permit U.S. developers to communicate with their customers
`via email and other means outside their apps about purchasing methods other than in-app
`purchase.
`(4) Price points. Apple will expand the choice of App Store price points by December 31,
`2022.
`(5) App rejection. Apple will clarify that U.S. developers can appeal the rejection of apps
`where they believe there has been unfair treatment by Apple.
`(6) Transparency. Apple will publish an annual App Store transparency report with data on
`App Review, search, security, and more.
`These are real benefits, and they are the product of extensive settlement negotiations between the
`parties in order to resolve contentious litigation and preserve judicial resources. Class counsel are
`entitled to be paid for their efforts in litigating this action. The question is how much.
`Non-monetary benefits are often difficult to quantify. See Campbell v. Facebook, Inc., 951
`F.3d 1106, 1125 (9th Cir. 2020) (“‘[I]t is difficult to put a dollar figure on’ the value of the non-
`monetary relief obtained by the class . . . .”) (quoting the district court’s decision); Laguna v. Coverall
`N. Am., Inc., 753 F.3d 918, 924 (9th Cir.), vacated as moot by 772 F.3d 608 (9th Cir. 2014) (“Monetary
`valuation of injunctive relief is difficult and imprecise.”). Only when “the value of the injunctive or
`non-monetary relief can be measured,” do courts readily take into consideration non-monetary relief
`for the purpose of awarding attorneys’ fees. Harris v. Amgen Inc., 2017 WL 6048215, at *7 (C.D. Cal.
`Apr. 4, 2017). As the Ninth Circuit has explained,
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`Precisely because the value of injunctive relief is difficult to quantify, its value is also
`easily manipulable by overreaching lawyers seeking to increase the value assigned to
`a common fund. We hold, therefore, that only in the unusual instance where the value
`to individual class members of benefits deriving from injunctive relief can be accu-
`rately ascertained may courts include such relief as part of the value of a common fund
`for purposes of applying the percentage method of determining fees.
`Staton v. Boeing Co., 327 F.3d 938, 974 (9th Cir. 2003).
`Plaintiffs’ expert, Prof. Economides, has made an effort to quantify a portion of the non-
`monetary relief here, but his opinion is not definitive. His calculation consists of an extrapolation of
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`DEFENDANT APPLE INC.’S RESPONSE TO DEVELOPER PLAINTIFFS’ MOTION FOR ATTORNEYS’ FEES,
`REIMBURSEMENT OF EXPENSES, AND SERVICE AWARDS
`No. 4:19-cv-03074-YGR
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`Case 4:19-cv-03074-YGR Document 467 Filed 02/28/22 Page 4 of 6
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`future savings to developers, compared to standard commission rates, based on incomplete data for the
`first months of the Small Business Program. Dkt. 459-7, ¶¶ 16–17, 19–22. It has not been the subject
`of any competing testimony, discovery, or adversarial testing. Neither Apple nor the Court has any
`way of knowing if this calculation is accurate, too high, or too low.
`Many settlements contain both monetary and non-monetary relief, as this one does. And in
`many settlements, the non-monetary relief confers real benefits on class members, as the terms here
`do. But it will often be difficult to quantify these benefits. For this reason, the Ninth Circuit prescribes
`that, typically, class counsel should be awarded 25 percent of the ascertainable value of a settlement as
`attorney’s fees. See Stanton, 327 F.3d at 968. The amount of any cash settlement fund is the most
`objectively verifiable measure, and generally does not give rise to ancillary litigation regarding
`valuation methodologies.
`The Ninth Circuit’s 25 percent guidance promotes predictability and certainty for plaintiffs and
`defendants alike. It ensures that plaintiffs, their lawyers, and experts will not over-invest in
`unmeritorious cases, and it allows defendants to predict their likely exposure in deciding whether to
`settle or continue litigating. Perhaps most importantly, the 25 percent guidance protects absent class
`members by ensuring that the majority of the cash achieved in settlement—75 percent or more—is
`available to the class members rather than the lawyers. These values would be jeopardized if courts
`were routinely to examine uncertain non-monetary terms to increase the fee award. Indeed, that
`approach could result in a whole second round of expert-intensive litigation, contrary to Supreme Court
`guidance and the public policy favoring private settlements to conserve judicial resources. See Hensley
`v. Eckerhart, 461 U.S. 424, 437 (1983) (“A request for attorney’s fees should not result in a second
`major litigation.”); In re Syncor ERISA Litig., 516 F.3d 1095, 1101 (9th Cir. 2008) (“[T]here is a strong
`judicial policy that favors settlements, particularly where complex class action litigation is
`concerned.”); 4 William B. Rubenstein, Newberg on Class Actions § 13:44 (5th ed. 2021) (“The law
`favors settlement, particularly in class actions and other complex cases where substantial resources can
`be conserved by avoiding lengthy trials and appeals.”).
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`DEFENDANT APPLE INC.’S RESPONSE TO DEVELOPER PLAINTIFFS’ MOTION FOR ATTORNEYS’ FEES,
`REIMBURSEMENT OF EXPENSES, AND SERVICE AWARDS
`No. 4:19-cv-03074-YGR
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`Case 4:19-cv-03074-YGR Document 467 Filed 02/28/22 Page 5 of 6
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`The settlement fund here is large—$100 million. An award totaling 25 percent of that fund
`would constitute a substantial sum—$25 million. Plaintiffs’ counsel do not suggest that this amount
`would be insufficient to compensate them for their investment in the case. Indeed, counsel
`acknowledge that their lodestar fees are about $11 million. Dkt. 465 at 9. They seek a fee award of
`almost 2.5 times that amount: $27 million. On its face, that request raises questions regarding
`overcompensation. Apple does not intend to suggest that the lodestar is controlling in every case, but
`the Ninth Circuit has made clear that it must be considered. See Vizcaino v. Microsoft Corp., 290 F.3d
`1043, 1050 & n.5 (9th Cir. 2002).
`Plaintiffs’ counsel invoke the factors for adjusting fee awards discussed in Kerr v. Screen Extras
`Guild, Inc., 526 F.2d 67, 70 (9th Cir. 1975), even while recognizing that multipliers have increasingly
`been disfavored by the Supreme Court. See Dkt. 564 at 20 n.54 (citing Resurrection Bay Conserv.
`Alliance v. City of Seward, 640 F.3d 1087, 1095 n.5 (9th Cir. 2011) (noting doubt cast by Supreme
`Court on two Kerr factors used as bases for lodestar enhancement)). Indeed, the Supreme Court “has
`never sustained an enhancement of a lodestar amount for performance, but has repeatedly said that an
`enhancement may be awarded in ‘rare’ and ‘exceptional’ circumstances.” Perdue v. Kenny A. ex rel.
`Winn, 559 U.S. 542, 543 (2010). Plaintiffs’ counsel do not dispute that this case was resolved early in
`its litigation history—before class certification, dispositive motions, or trial. Shortly after the
`settlement agreement was signed, this Court rejected analogous claims in Epic v. Apple, Case No. 4:20-
`cv-05640-YGR, which may have imperiled any later recovery by the class at all. Counsel did not risk
`it all here. A $25 million award, all in, would still be 167% of their investment—a healthy return in
`any environment, and particularly generous in light of Epic.
`Apple believes that as much money as possible from the Small Developer Assistance Fund
`should end up in the hands of the small app developers who choose to make claims pursuant to the
`settlement facility. The total amount of fees requested by Plaintiffs’ counsel appears high, both as a
`percentage of the cash fund and as a lodestar multiple. While Apple ultimately does not oppose entry
`of a fee award in the amount requested by Plaintiffs, Apple wishes to stress that the Court has the
`discretion to award fees in the amount it determines to be appropriate.
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`DEFENDANT APPLE INC.’S RESPONSE TO DEVELOPER PLAINTIFFS’ MOTION FOR ATTORNEYS’ FEES,
`REIMBURSEMENT OF EXPENSES, AND SERVICE AWARDS
`No. 4:19-cv-03074-YGR
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`Case 4:19-cv-03074-YGR Document 467 Filed 02/28/22 Page 6 of 6
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`DATED: February 28, 2022
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`GIBSON, DUNN & CRUTCHER LLP
`By: /s/ Mark. A. Perry
` Mark A. Perry
` Theodore J. Boutrous Jr.
` Richard J. Doren
` Daniel G. Swanson
` Veronica S. Moyé
` Cynthia E. Richman
` Ethan D. Dettmer
` Rachel S. Brass
` Caeli A. Higney
`Attorneys for Defendant Apple Inc.
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`DEFENDANT APPLE INC.’S RESPONSE TO DEVELOPER PLAINTIFFS’ MOTION FOR ATTORNEYS’ FEES,
`REIMBURSEMENT OF EXPENSES, AND SERVICE AWARDS
`No. 4:19-cv-03074-YGR
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