Class

Appellants are 25 law firms (“Class Counsel”) who represented bondholders (“Class Plaintiffs”) in the largest municipal bond default in history. From 1977 to 1983, the Washington Public Power Supply System (‘WPPSS”) sold bonds with a face value of $2.25 billion to finance construction of two nuclear power plants. The plants were never completed and WPPSS defaulted on its bond payments. In 1983, purchasers of the bonds filed a class action against WPPSS and nearly 200 other defendants alleging violations of state and federal securities laws in the sale of the bonds. 1 The claims of class members totalled almost $1.47 billion. The ease was ultimately resolved through 22 separate settlement agreements, which created a settlement fund of $687 million.

Class Counsel requested attorneys’ fees totalling $103 million from the settlement fund, which they asserted was a reasonable fee under either the percentage-of-the-fund method or the lodestar/multiplier approach. 2 See In re Washington Pub. Pow *1295 er Supply Sys. Sec. Litig., 779 F.Supp. 1063, 1084 (D.Ariz.1990) [hereinafter WPPSS II]. Under the lodestar approach, Class Counsel reached their $103 million figure by enhancing a…