Holocaust survivors object to lawyer’s request for settlement pay

By Lona O’Connor

Palm Beach Post Religion Writer

Monday, March 20, 2006

After outwitting death at Auschwitz-Birkenau, Alex Moskovic has spent decades advocating for less fortunate Holocaust survivors. He has recounted his death-camp experiences to thousands of schoolchildren and he volunteers on the advisory board for Palm Beach County Jewish social services.

The Hobe Sound resident and retired Emmy-award winning ABC sports editor was also one of thousands of survivor-plaintiffs in Holocaust restitution lawsuits against the German and Swiss governments.

Those lawsuits, and many years of fractious negotiations, eventually produced multibillion-dollar settlements to aid Holocaust survivors around the world. One of the men responsible for those settlements is Burt Neuborne, a prominent New York attorney and law professor.

Neuborne is claiming $4 million in fees. Moskovic and others contend Neuborne should not get it because he said repeatedly during nearly seven years of litigation that he would not take any pay for his work.

So the survivor and the attorney find themselves combatants in an ugly court battle over money.

One of Moskovic’s duties is to help decide which needy survivors get modest grants for food, medicine or home repairs from a limited county social services budget. So he frames the Neuborne fee conflict in these terms:

“When I look at a fee of $4 million, here’s what I see,” he wrote to New York Federal District Chief Judge Edward Korman, where the fee case is pending. “To me it means that 740 victims can receive home care for a year.”

Moskovic is one of 18 survivors who launched a formal objection against Neuborne’s December request for $4 million in fees. They were unaware of Neuborne’s fee request until January, when they were called by a reporter for Forward, a national newspaper, though they are supposed to be notified by the court of all actions taken on their behalf.

The $4 million fee covers his work on the settlement phase of a 1997 case that held Swiss banks accountable for restitution.

The $1.25 billion in restitution represented partial repayment of money and valuables stolen from Jews by the Nazi German government during World War II and secreted in Swiss bank accounts for decades after the war. Survivors and their heirs, some holding bank account numbers and other documents to prove their claims, fought unsuccessfully for decades to extract the money from Switzerland.

Then, in the 1990s, under pressure from the U.S. government and intense media attention, the restitution cases were settled, a historic step toward justice, the survivors believed.

When Neuborne first went to work on the Swiss bank litigation, he repeatedly told survivors, other attorneys and the judge that he would work without payment, court documents show.

So survivors were thunderstruck, then outraged, to hear that Neuborne had lodged a request for a fee.

Aided by sympathetic lawyers, a group of 18 survivors, each representing a regional survivor group, filed a caustic objection to Neuborne’s fee request on Feb. 23.

They claimed Neuborne had billed them $700 an hour, sometimes for nonlegal services such as speeches, and billed them for 20-hour work days on the restitution cases during a time when he was simultaneously working on another demanding and high-profile case, the McCain-Feingold finance law litigation.

In an e-mail, Neuborne declined to comment. But he makes his defense in detail in court documents and public statements. He wrote in February to The New York Times that his fee was only for the highly detailed and tricky settlement phase of the Swiss bank case, not for the litigation phase that preceded it. He said that he agreed to work on the settlement phase only after Judge Korman urged him strongly to do so. At that time, he and the judge agreed that he would be paid, he wrote.

In a January memo to Korman, who also oversaw both phases of the case, he sought to justify his claim to be paid for years of work that brought the case to fruition.

He said he had worked at least 8,000 hours helping to shape the settlement’s intricate payment structure. He said his work included 29 significant court appearances, 16 appeals, three rounds of negotiations and two congressional hearings. He told the judge he considered 8,000 hours a conservative estimate, $700 an hour consistent with his experience and the $4 million — which he voluntarily discounted from the $5.6 million he would have been owed — was a reasonable charge for nearly seven years of work that enhanced the money gained for survivors.

To Moskovic, the number of hours or years that Neuborne worked is not the point. He is convinced that Neuborne intended all along to ask for a fee, and that Neuborne deliberately avoided telling the survivor groups because he knew they would object vehemently.

“What I’m against is keeping it a secret,” said Moskovic. “Why didn’t we know about it? As far as we were concerned, he was working pro bono all along. He’s trying to patronize me. He said, here is a survivor, I will give him a snow job.”

Moskovic was referring to a letter in which Neuborne wrote to Moskovic on Feb. 17:

“You apparently misunderstood my remarks,” Neuborne began. “It is true that I waived fees of many millions of dollars for achieving the Swiss bank settlement. I remain proud of that fact. But, from the date of my appointment in April, 1999 as Lead Settlement Counsel, it was understood by Judge Korman and by my co-counsel that no one could be expected to serve for many years as Lead Settlement Counsel without reasonable compensation. My intensive legal work for the class not only made possible the successful administration of the settlement, which has now distributed almost $840 million to victims, it actually added more than $50 million to the settlement fund. I am asking for 7% of the additional funds that my work added to the settlement fund…. I am genuinely sorry that you are disappointed in my decision.”

Unfortunately for the survivors, Korman was receptive to Neuborne’s arguments.

In a March 2 meeting with lawyers involved, Korman said he thought Neuborne was entitled to his fee.

“He rendered extraordinary service,” Korman said. “He’s entitled to be paid a reasonable fee…. So what this leaves for discussion is what is a reasonable fee.”

Korman went on to say, “We know what (is) the basic view of the survivor community in general about paying lawyers…. They don’t want lawyers to get paid. They would rather have them work for nothing…. I could understand that. I would like the people who represent me to work for nothing too.”