Court Vacates Award After Attorneys’ Fees Cut

(CN) - The 4th Circuit vacated an $18 million award for a man injured in a car crash because a lower court wrongly slashed his attorneys' contingency fees from $6 million to just $600,000.

In 2005, Mark Pellegrin, was hit by a truck driven by his friend who had been drinking. Pellegrin is still dependent on others to eat, get dressed, bathe and use the bathroom.

Pellegrin's father, Jerry, hired attorney Charles Bourque with the Louisiana law firm St. Martin, Williams and Bourque to sue.

Jerry Pellegrin agreed to pay the firm 33 percent of any gross recovery, plus expenses. Bourque later retained the North Carolina firm of Abrams & Abrams, P.A., and the firms agreed to split contingency fees equally.

After a one-day mediation, National Union Fire Insurance Co. agreed to pay $18 million. Of that amount, $6 million was to pay attorneys.

But the district court wrongly reduced the amount to $600,000 - or from 33 percent to 3 percent - the circuit ruled.

"The facts of this case illustrate precisely the type of situation in which a contingency fee may be the only way an individual can protect his interests," Judge J. Harvie Wilkinson III wrote. "Yet the district court's analysis made no mention of the role that contingent compensation played in providing the Pellegrins with access to court."

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