Robbins

Plaintiffs, stockholders of BankAmerica Corporation (BankAmerica), brought a shareholder derivative suit on behalf of BankAmerica, against a number of former members of the board of directors of BankAmerica and Security Pacific Corp. (Security Pacific), alleging, generally, that defendants had mismanaged both companies, with the result that the companies ultimately paid $187.5 million to settle claims by the State of California and the City of San Francisco. Plaintiffs and defendants agreed to settle this suit, and, by separate agreement, further agreed that the companies’ successor, BankAmerica Corporation (BofA) would pay plaintiffs $5 million for attorney fees and expenses incurred in litigating the action.

A number of stockholders, including Angelo and Mary Perone (objectors) objected to the settlement, to the agreement to pay attorney fees, or both. BofA, however, favored both agreements, and urged the trial court to approve them. The trial court, agreeing with BofA, approved the settlement and the negotiated fee award. Objectors appeal. They do not complain about the substantive terms of the settlement. They contend that the attorney fees are too high, asserting…