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Quinn Emanuel disclosure order highlights relatively new product: judgment preservation insurance

By Debra Cassens Weiss

January 31, 2024, 3:39 pm CST

Quinn Emanuel Urquhart & Sullivan must disclose terms of judgment preservation insurance that it allegedly bought before distributing a $185 million fee award to partners, according to a U.S. Court of Federal Claims judge.

In a Jan. 30 opinion, U.S. Federal Claims Judge Kathryn C. Davis ordered Quinn Emanuel to disclose the policy document but denied a request for an accounting and safekeeping of the funds, report Reuters and Bloomberg Law.

A group of health insurers that objected to the legal fee had sought the information.

Davis ruled after the U.S. Court of Appeals for the Federal Circuit vacated the $185 million award because she failed to properly conduct a “lodestar cross-check” that considers hours worked, billing rates and a risk multiplier to compensate for the risk of no or reduced recovery. The appeals court said the fee award had an implicit multiplier that was “outside the mainstream” and ordered Davis to reassess the amount.

The award translated to an hourly fee of about $18,500, according to previous coverage of the case.

Bloomberg Law called judgment preservation insurance “a relatively new area of litigation finance” that is becoming more popular. Typically, it is used to preserve some portion of large awards from being overturned on appeal, but details of such polices are mostly under wraps.

A Bloomberg Law article written by an outside contributor described judgment preservation insurance, known as JPL, as “appellate risk insurance.” The insurance can be obtained by a party or a litigation funder, and it kicks in after a judgment is final with no further possibility for appeal.

“It may insure all of the judgment, or it may be targeted at a specific legal issue that is challenged on appeal, such as attorneys’ fees or statutory damages,” the contributed article reports.

Davis said she was ordering the policy disclosure in the interest of transparency. She also said the policy terms would be relevant on remand “if the policy provisions are inconsistent with the court’s objective ‘to ensure an overall fee that is fair for counsel and equitable within the class.’”

Quinn Emanuel received the $185 million fee award in its representation of two classes of health plan insurers in litigation under the Affordable Care Act. The insurers said the federal government did not abide by its promise to pay them for losses incurred for the first three years of participation in the law’s insurance marketplace. The litigation settled for $3.7 billion, and the $185 million represented 5% of the award.

The case is Health Republic Insurance Co. v. United States.

LAKE COUNTY, Calif. — Secretary of the Interior Deb Haaland and Bureau of Land Management (BLM) Director Tracy Stone-Manning visited Berryessa Snow Mountain National Monument this weekend to meet with federal, Tribal, state and local officials, and community members to learn about their vision for conserving the natural and cultural resources in the region.

During the visit, Secretary Haaland, Director Stone-Manning, Congressmen John Raymond Garamendi and Mike Thompson, and leaders from the BLM and U.S. Forest Service heard directly from the community on proposals to expand the existing National Monument to protect culturally important sites on adjacent BLM-managed public land. There is pending congressional legislation to expand the monument, rename the area commonly known as “Walker Ridge” to Condor Ridge, or Molok Luyuk in the Patwin language, and provide opportunities for the BLM and the U.S. Forest Service to further collaborate with Tribes in the management of the National Monument.

The Berryessa Snow Mountain National Monument was established by Presidential Proclamation on July 10, 2015, in order to protect its rich biodiversity, including rare endemic species, unique serpentine outcrops, relic prairies, and riparian habitats. In addition to providing essential habitat for fish and wildlife, the area is important for scientific study, prehistoric and historic preservation, and exceptional outdoor recreational opportunities.

The lands within the Monument are some of the most scenic in northern California, ranging from rolling oak-studded hillsides to steep canyons and ridgelines with expansive views. These lands retain deep cultural significance for approximately two dozen federally recognized Tribes who inhabited them for at least the last 11,000 years.

Encompassing more than 330,000 acres of public land, the National Monument is jointly managed by the BLM (approximately 133,000 acres) and the U.S. Forest Service (approximately 197,000 acres). Since the establishment of the Monument, the two agencies have worked to carefully manage the objects and values identified in the proclamation. The agencies have held several community conversations to gather public input and build a shared vision for stewardship of the Monument. Additionally, the BLM has created and filled a new Tribal Liaison position in California to facilitate consultation and collaboration with Tribes.