NYU Law Professor Burt Neuborne Gets His Due -- New York Magazine

Getting His Due

Neuborne’s fee petition surprised almost everyone. Wasn’t he working for free? they asked. For the American survivors, the $4 million fee was the final outrage. “In a class-action case, nobody is really thrilled that lawyers walk away with millions. But at least you know who your lawyer is; it’s clear that he’s working on your behalf,” says Thane Rosenbaum, a son of Holocaust survivors and a Fordham law professor who opposed the 75-21-4 formula. “This is twisted. The lawyer who fought you is sticking you with his bill.”

Even one of the dozen attorneys who worked on the case, Robert Swift, was “surprised, to put it mildly,” when Neuborne petitioned for payment. “I think it is unethical,” Swift told me. “When there is a fee arrangement, it must be disclosed to the client—in this case, the survivors. After the fact, we learned of an agreement between Burt Neuborne and the judge. What are the details? Why wasn’t it discussed?” Dubbin argues that it’s a conflict of interest: “Neuborne supported the judge in his rulings, then … asks the judge to approve his fees.”

Dubbin and Swift have gone to court to block payment. Neuborne responded with a gambit: He removed 1,600 disputed hours from his bill, but he also removed his discount, raising his fee by $671,500 in the process. The bill now comes to $4.76 million. Korman—who declined to speak with me because of the legal challenge—has recused himself. A federal magistrate, Justice James Orenstein, accepted written arguments from both sides over the summer and is expected to rule on the fee issue any day now.

“A fee must be disclosed. After the fact, we learned of an agreement between Burt Neuborne and the Judge. I think it’s unethical.”

In court papers, Neuborne argues that even though Korman never entered an order declaring that Neuborne’s pro bono status changed when he became lead settlement counsel, his bill should not have been a surprise. The issue of fees came up in a January 2001 court hearing and in a 2002 law-journal article Neuborne wrote, he says. A transcript of the hearing shows only that Korman was willing to award Neuborne fees for settlement work, not that Neuborne definitely was going to seek them. In his article, for the Washington University Law Quarterly, Neuborne addressed the issue in a one-sentence footnote: “Hourly payments for post-settlement work needed to administer the fund will be sought,” he wrote. Six lawyers who worked with Neuborne have submitted sworn statements saying they assumed that he would be seeking fees for his work on the settlement. Yet as recently as September 26, 2005, Neuborne made no distinction between the first, pro bono phase of the case, and this second, fee-for-service settlement phase, telling a federal judge in Miami, “I am the lead settlement lawyer in the Swiss case in which I served without fee now for almost seven years.” In person, Neuborne argues that the September 26 statement was just good lawyering, an attempt to short-circuit an avenue of appeal by making clear he had no financial stake in the settlement’s approval.

This summer, as the magistrate entertained arguments in the case, the Times weighed in with an editorial. It praised Neuborne’s role and said, “No one should be expected to do arduous, complicated legal work without pay.” But the editorial jumped on Neuborne’s request for $700 an hour. “The dollar amounts are troubling … Top corporate lawyers charge that much, or more. But Holocaust victims are not Exxon Mobil. It is an unseemly rate to be asking.” The Wall Street Journal published Neuborne’s rebuttal online: “During the Middle Ages the Catholic Church insisted that Jewish merchants charge a ‘just price’ instead of market value,” Neuborne wrote. “The Times has gone into the same business.”

The exchange encapsulates the eternal philosophical divide between idealists, who believe the Holocaust is not something anyone should be profiting from, and the market-based realists, who argue that justice has a price and it ought to be paid. Yet the extraordinary rhetoric and bitterness comes from someplace else: What seems like just a fight over the bill is, at a deeper level, a rift between the rank and file and the leaders representing them.

Rechter and other grassroots survivor leaders have long believed that the Jewish Establishment spends too much on Holocaust commemoration and too little on the needs of those who actually survived Hitler. They see Korman’s rulings—backed by Neuborne—as an expression of the organized community’s will over theirs and the ADL’s decision to give Neuborne its American Heritage Award, which is designed to recognize a fighter for American values, as a rebuke. “Institutions tend to have a very different pulse and mind-set than the rank and file. They are led by professionals … with law degrees and M.B.A.’s … who have a sense of administrative purpose and a feeling of ‘we know what’s best,’ ” says Rosenbaum. “It’s an appealing idea to force nations and banks to be accountable. But they forgot to listen here to the people who have the greatest moral authority, the survivors themselves.”