They risked their jobs and physical safety to expose a federal crime.
And for their bravery in reporting the secret dumping of oily sludge into waters from Cape Cod to California, the 12 ship workers - most of them poor Filipinos - received an unanticipated reward: $437,500 apiece in government whistle-blower payments.
Now a Texas lawyer is trying to take what federal prosecutors in Massachusetts call a "manifestly unreasonable" cut of those awards, and the prosecutors have taken the uncommon step of asking a judge to deny his fees.
If a Boston court approves the 33 percent contingency fee requested by Beaumont, Texas, lawyer Zachary J. Hawthorn, he would receive a total of almost $300,000 from his two clients, even though the other ship workers were billed less than $10,000 each by their lawyers for similar work - and one was not billed at all.
"You have these people from countries outside the US who did a courageous thing to report something they thought was wrong, and then they end up with this amazing and unexpected windfall that the government essentially arranged for them," said Allison D. Burroughs, a partner at the Boston law firm Nutter McClennen & Fish, who also represented one of the ship hands. "For any lawyer to claim a third of that is just not right."
Burroughs said she charged her client, an engineer who notified authorities that the oil tanker was illegally discharging waste, "well under $10,000" for her legal services.
The fee dispute poses an unusual dilemma for the court. There are no firm guidelines for how much a lawyer can claim of a whistle-blowing client's award. As a general rule, excessive legal fees are prohibited by state and federal law. And judges are typically reluctant to interfere with lawyer-client fee arrangements, especially when a client has not complained; in Hawthorn's case, both of his clients have sent e-mails asking the judge to approve the contingency agreement.
But the judge in this case said any legal fees over $10,000 would have to be approved by the court. In their motion urging the court to reject Hawthorn's request, US Attorney Michael J. Sullivan and assistant US Attorney Jonathan F. Mitchell describe the contingency fee as "grossly disproportionate to the amount and importance of the work Hawthorn performed."
They suggest Hawthorn took advantage of unsophisticated ship hands who are not native English speakers and who had little familiarity with the American legal system. They also contend his work was "materially indistinguishable" from that of the other lawyers, who were paid 90 percent less than his requested fee. One of the lawyers, a public defender in North Carolina, received no fee at all.
Hawthorn, reached by phone at Hawthorn & Hawthorn, where he practices with his father, said the case required "a whole hell of a lot of work."
"I flew halfway across the county on my own ticket, I paid for local counsel on my own ticket, I did all this preparation on my own ticket, and if I wasn't up there, most likely they would have gotten nothing," said Hawthorn, referring to a March trip to Boston he made for his clients, John O. Altura and Benedict A. Barroso,. "If they can have $437,500 minus 33 percent, I think they'd rather have that over nothing."
Neither Altura nor Barroso, who live in the Philippines, responded to e-mailed requests for comment.
But James L. Sultan, a Boston lawyer representing a ship worker, said he charged his client less than $10,000. He called Hawthorn's fee "excessive" and said the cases "didn't require a lot of brilliant lawyering."
This is the not the first time that hefty legal fees have become an issue in the state. In 2003, the Boston law firm Brown Rudnick Berlack Israels sued to enforce its 25 percent contingency fee for handling the 1998 nationwide $246 billion tobacco industry settlement. The firm ultimately lost its fight when an arbitration panel voted to award the Massachusetts lawyers $775 million, or 9.3 percent of the state's $8.3 billion share. In a different case, the Supreme Judicial Court in 1991 overturned a lower court's rejection of a 33.3 percent contingency fee totaling $975,000 that a Superior Court judge called unconscionable but that the lawyer's client had not opposed.
The ship hands - 11 Filipinos and one Korean - worked aboard several oil tankers owned by New York-based
By exposing the crime, "several crew members in this case perceived that their employment was threatened and/or their physical safety was in jeopardy," according to a motion by the US attorney's office justifying the awards.
Because the illegal dumping was so widespread, the cases were investigated in several states and the ship workers were represented by lawyers across the country. All the cases eventually were consolidated in Massachusetts.
The case is being overseen by US District Judge Reginald C. Lindsay, but a Nov. 19 hearing on the matter will be heard by US Magistrate Judge Robert B. Collings.
Contingency fees are paid only when a lawyer achieves a favorable result for a client, and they often provide access to the courts for people who cannot afford to pay a lawyer an hourly rate. The lawyer, in turn, assumes the risk of taking a case that may not result in a financial payout.
Hawthorn argues that he took such a risk and that without his assistance his clients were in danger of receiving no whistle-blower money. He maintains Altura and Barroso faced more complicated legal issues than the other ship workers because of the way their case evolved in the Texas court where it originated. He also contended that a March hearing, Judge Lindsay said he had a "modest reservation" about authorizing whistle-blower payments for the "Texas people." That comment prompted Hawthorn to address the court and ask Lindsay to give his clients awards.
"I thought they were at great risk of not receiving anything, so I said my piece, and it wasn't a lot, but it got the job done," Hawthorn said. He also described Altura and Barroso, who he said speak English without a translator, as "sophisticated clients."
But federal prosecutors, as well as Burroughs and Sultan, contend that all 12 ship hands were nearly guaranteed to receive whistle-blower money because none of the parties in the case opposed the payments.
Burroughs also noted that the dates on Hawthorn's contingency agreements indicate he secured them after the government announced the $437,500 payments. "The idea behind contingency fees is you're sharing risk, but there really wasn't any risk here," she said.
Hawthorn denied that, saying the agreements were made before the whistle-blower awards were disclosed. He also said that when his clients signed the contracts, he had no idea whether they would receive any government money.
"This is a contract that both parties agreed to at the start, that both parties agreed to at the end, and they're happy," Hawthorn said. "Now we have a third party interject themselves and ask the court not to approve it. I just don't understand the basis for that."
Sacha Pfeiffer can be reached at pfeiffer@globe.com.
