Trials & Litigation

Attorney and law firm must pay $67K in legal fees for 'vexatious' suit challenging airline merger

In an unusual move, a federal appeals court has sanctioned a prominent San Francisco plaintiffs law firm and its name partner by ordering reimbursement of $67,495 in opponent legal fees for pursuing what opponents called “unreasonable and vexatious” litigation over an airline merger.

Joseph Alioto and the Alioto Law Firm “sunk to a new low,” contended Southwest Airlines Co and AirTran Holdings Inc. in their filings, both by filing an antitrust complaint a day after the 2011 merger closed and by pursuing an emergency appeal seeking broader relief after their request for a temporary restraining order to prevent the merger from going through was denied, reports Reuters.

“Counsel’s modus operandi in these cases is to sue companies that are attempting to complete high profile mergers at the most time-sensitive stage of the transaction in hopes of extracting a cash settlement that does not benefit (and indeed ultimately increases the costs to) the public at large,” the airlines contended in filings.

Skadden, Arps, Slate, Meagher & Flom, which represented the airlines, had sought $82,000 for work done at hourly rates of as much as $986. However, the 9th U.S. Circuit Court of Appeals disallowed some of the costs the law firm requested.

Alioto did not respond to the news agency’s request for comment.

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