Letter to Ken Feinberg
Ken Feinberg, Esq.
The Willard Office Building
1455 Pennsylvania Avenue NW
Washington, D.C. 20004-1008
In the interest of accuracy, I want to run by you what I remember from our brisk conversation the other day on lawyer fees and the distribution of the $1.45 million (and the earlier $150,000 or so money from Boeing) for each family from the 737 MAX crashes in Ethiopia and Indonesia.
- Boeing contracted with you to distribute the monies to the beneficiaries of the decedents and pays all of your expenses following the January 5, 2021 Justice Department deferred prosecution agreement with Boeing.
- The claimants have to fill out various forms for proving their right to the disbursement. Unless there are complications, as in some foreign countries, filling out these forms takes little time but the next of kin may want some legal help doing so.
- About 25 claimants asked for your help and your office helped filling out the forms pro se. Other law firms like Clifford’s provided this service for their clients for free. Your website does not proactively offer this pro se service. Just the opposite. It suggests attorney services.
- A majority of the claimants, however, did have lawyers. For those, you recommended ten percent as a reasonable fee for such a service. That would total $145,000 for very little work, except perhaps in a few foreign countries. You agreed the 9/11 lawyers’ work was quite different than lawyers filling out forms for a government mandated set sum. I suggested that an hourly fee was appropriate for a no risk sum, rather than a percentage fee usually reserved for a contingent litigation.
- When I asked why you recommended a percentage fee for so little work toward the distribution of a sum certain, you said that some lawyers could stack up an hourly fee that would amount to 30 percent to 40 percent. I indicated that you must be joking, and you seemed to agree. So again, why a percentage fee and why ten percent given the work involved?
- According to your office, a small majority of the plaintiffs in the 156 cases who have already received the distribution retained a lawyer and some paid the entire ten percent. You said that you did not have the details. You said that in three to six months all the remaining awards would be distributed.
- Surprisingly, you said that the Department of Justice has no interest in the above situation that raises serious questions of ethics and fair dealing. You may well be right as a factual matter. But according to the deferred prosecution agreement, only the Fraud Section of the Department of Justice “shall be empowered to make final decisions regarding a) the individuals who should receive the victim payments from the Crash-Victims Beneficiaries Compensation Amount and b) the compensation amounts that these victims should receive.” (Deferred prosecution agreement, page 13).
In short, since Boeing is required to pay all of your expenses, why couldn’t your office have done these form filing services without charge to the claimants? If there were a few complications, as you said in Somalia, etc., local counsel could be retained at Boeing’s expense.
- It seems that some of these charging lawyers are justifying this overreach, to put it mildly, by referring to you as the authority for what is a reasonable fee – e.g., ten percent or $145,000 – plus a similar percentage earlier on the $150,000, if that was the case. This should bring you to a reconsideration of this development and whether this should lead to a different kind of advisory from your office. There are knowledgeable people in legal ethics who believe that the ten percent lawyers should be refunding that sum, minus a few by the hour charges. (See attached article.)
What makes this story so heartbreaking, Ken, is that it comes after a sweetheart settlement by the Department of Justice, dashing the expectations of the families for punitive justice on the company and its top culpable officials. They then receive in toto a far smaller sum than did the airlines – already the recipients of some $50 billion in pandemic subsidies, in spite of $45 billion in stock buybacks over a few past years. Then comes the carve out from lawyers at levels that can only be called “larcenous.”
You’ve had to deal over the years with many sticky issues inside the personal tragedies that require judgment calls which are not easy to make. I urge you to put your experience and sense of equity to work to produce restitutions that are clearly equitable and needed. For those families not yet in receipt of their awards, you can forestall the ten percent problem and proactively provide pro se services.
After all, your calls are not always entirely excellent and perfect. No one is perfect. Mistakes under pressure are understandable. Let’s hear from you.
If there are any correctable recollections above, let me also know about them.
P.O. Box 19312
Washington, D.C. 20036
Attached: They Took Ten Percent for Something They Had Zero to Do With by Corporate Crime Reporter, November 8, 2021.