Concerns over lawyer pay in NFL deal

Updated: December 16, 2013, 10:30 PM ET
By Mark Fainaru-Wada and Steve Fainaru | ESPN.com

When the NFL concussion settlement was announced nearly four months ago, the more than 4,500 players who had sued the league were assured that no part of the $765 million deal would go to lawyers.

But a recent dispute involving the players' lead negotiator confirms that not only was that statement misleading, some lawyers stand to receive multiple paydays, according to documents and emails obtained by "Outside the Lines."

The development comes as the settlement drags into its 16th week, still without preliminary approval from the federal judge overseeing the case. And while "Outside the Lines" has learned that preliminary approval could come soon, interviews with attorneys and former players find growing discontent on multiple fronts, including the unusually long delay delivering the case to the judge and a veil of secrecy that continues to shield basic information from the plaintiffs.

The latest concerns are that negotiators may reward themselves at the expense of injured athletes.

The dispute arose when Christopher Seeger, the players' lead negotiator, tried to arrange an agreement to receive a 10 percent cut of any money awarded to a 79-year-old former NFL player, Billy Kinard. Seeger quickly withdrew the proposal after the player's attorney challenged it by calling the arrangement "most troubling" and suggesting that Seeger was inappropriately using his position to benefit financially.

Seeger is among a select group of attorneys on the plaintiffs' executive committee -- lawyers appointed by the judge to negotiate with the NFL. His firm, Seeger Weiss LLP, is in line to receive a significant portion of a "common fund" paid for by the league and specifically created to cover legal fees. That fund could exceed $100 million and is apart from the $765 million announced in August.

The creation of the fund raised concerns that some lawyers would engage in "double-dipping" -- drawing money from both the common fund and separate fee agreements and potentially siphoning millions of dollars from the pool of money allotted to injured players.

Early Monday afternoon, "Outside the Lines" reported that legal experts said the issue was likely to draw the attention of federal judge Anita Brody. A few hours later, Brody issued an order stating she had appointed a special master to assist her in evaluating the "financial aspects" of the proposed settlement. She said the "appointment is warranted by the expected financial complexity of the proposed settlement."

Brody wrote that the special master's tasks "will include, but are not limited to, financial analysis of any agreements reached by counsel to the parties."

"We are pleased that Judge Brody has appointed Mr. Golkin as Special Master and we look forward to working with him, and continuing to work with the Court, as we seek prompt preliminary approval of the settlement agreement," Seeger and lead NFL attorney Brad Karp said in a joint statement Monday night. "We will proceed on any schedule that the Court directs."

The case involving Kinard underscores one of the settlement's complexities. The former player's lawyer, Sam Franklin, said that after reviewing the fee agreement he became worried that Seeger Weiss, as lead counsel, was trying to extract money from Kinard on top of what the firm would receive from the common fund.

"That's what's wrong: It's double-dipping, getting paid by the defendant and getting an additional 10 percent by each client you sign up," said Franklin, an Alabama class action attorney. "I've never seen anything like this."

Franklin sent a letter to Seeger demanding an explanation and asking pointedly: "On what basis do you believe your firm at this stage can propose an engagement to represent class members in seeking benefits from the claims process, including a fee of 10 percent plus a share of 'common expenses?'"

Franklin also asked Seeger how many clients he had signed up on that basis since the settlement was announced.

Seeger did not answer those questions in an email back to Franklin. He responded that his firm had agreed to represent Kinard "for the reduced fee of 10 percent." He added: "Although we absolutely reject your suggestions and assumptions of anything inappropriate, we will not be executing a retainer with your client, Mr. Kinard." Seeger offered to represent Kinard for free. Kinard declined the offer.

In a statement provided to "Outside the Lines," Seeger wrote: "Seeger Weiss is not representing any new plaintiffs, from when the settlement was announced on Aug. 29, on a fee arrangement. A small number of plaintiffs were mistakenly offered a retainer agreement after approaching Seeger Weiss for representation post-announcement. After learning of this error, we notified these plaintiffs and agreed to continue representing them for no fee."

It is unclear how many lawyers could be engaged in double-dipping and how many players might be affected. Most lawyers involved in the case have separate fee agreements with players; in some cases, those agreements call for the players to pay as much as one-third of any money they recover to their attorneys. Some of those lawyers also would be in line to collect from the common fund.

William Gibbs, a Chicago attorney whose firm, Corboy & Demetrio, represents the family of Dave Duerson, the former Bears defensive back who shot himself to death in 2011 after arranging to donate his brain to science, said he is concerned by the idea that the NFL would be paying money toward a common fund for lawyers rather than giving money to the injured players.

"I would be offended if the NFL has additional funds to pay into the proposed settlement that wouldn't go to all the guys across the country that are suffering," Gibbs said.

William Hubbard, a civil litigation expert at University of Chicago Law School, said the Federal Rules of Civil Procedure, which govern this class type of action litigation, do not prohibit double-dipping, but courts generally frown upon the practice. How the proposed settlement deals with attorney's fees will be a factor in whether the court approves the settlement, he said.

"I imagine that the judge will be very sensitive to the issue of double-recovery," Hubbard said. "If the court approves the settlement it will have to address to what extent double-recovery could occur."

Addressing this concern will be complicated, he said, because the settlement arose out of dozens of cases involving thousands of players who entered into fee agreements with their lawyers. Many of those lawyers will have no access to the common fund and thus will be paid only through these agreements.

"There's a lot of mouths to feed," Hubbard said.

Seeger addressed the broader question of double-dipping in his statement, explaining that, "the court has the right to review retainer agreements signed by individual plaintiffs that include a legal fee contingent on any monetary recovery."

The NFL concussion issue now appears certain to be litigated even as the settlement moves forward. A handful of new lawsuits have been filed against the NFL since the settlement was announced. This week, the estate of Hall of Fame center Mike Webster, whose problems ignited the concussion crisis, was preparing to sue the NFL in California Superior Court, along with dozens of other players. This follows an "Outside the Lines" report in September that Webster's family was cut out of the settlement entirely, along with the families of some other players who were diagnosed with football-related brain damage after they died.

Last week, former NFL quarterback Craig Morton, who spent 18 seasons in the league between 1965 and 1982, filed a similar lawsuit in U.S. District Court for the Northern District of California.

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