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June 29, 2018

Special Master Report on Overbilling Unsealed, Recommends Fines and Repayment

The special master’s report in the $300 billion State Street securities lawsuit has been released, and recommends plaintiffs’ attorneys return up to $10.6 million of the $75 million fee award, Law360 reports.

Judge Gerald Rosen, the special master, said the “most troubling” finding of his investigation was a $4.1 million payment to an attorney named Damon Chargois who introduced attorneys from Labaton Sucharow LLP, the lead class counsel, and the Arkansas Teacher Retirement System, which served as lead plaintiff. Judge Rosen said the Labaton attorneys engaged in “consistent, conscious and calculated efforts to conceal Chargois from almost all participants in the State Street litigation.” The report also recommended a partner at the Thornton Law Firm be sanctioned up to $1 million for the hours billed by his brother who worked on the case but was not an employee of the firm.

Senior U.S. District Judge Mark L. Wolf will soon determine official sanctions and penalties.

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