ANCHORAGE, Alaska--On orders from Gov. Frank Murkowski (R), the Alaska Department of Law is seeking to prevent attorneys who represented fishermen in a salmon price-fixing lawsuit from recovering any of the $40 million that has already been paid by seafood processors in pretrial settlements (Alakayak v. British Columbia Packers, Alaska Super. Ct., No. 3AN-95-4676-CI), hearing12/4/03).

However, the governor's effort suffered a setback on Dec. 4, when Alaska Superior Court Judge Peter Michalski denied a petition for an expedited intervention in the case. At a brief hearing that day, Michalski also gave preliminary approval to the settlement distribution, but set a hearing on final approval of the settlement distribution was for Feb. 5 to allow the fishermen in the plaintiff class to comment on the plan.

A jury ruled on May 23 in favor of the defense in the eight-year-old class action, denying the plaintiffs' claims that up to $1 billion was owed in damages to fishermen due to a conspiracy among largely Japanese-owned processors and importers (4 CLASS 428, 6/13/03).

Murkowski argued that the plaintiffs' attorneys, most of them from outside Alaska, pursued an ill-advised lawsuit that caused damage to the state's standing with Japanese salmon buyers. Only processors, their attorneys, and the approximately 4,500 fishermen in the plaintiff class should get any of the $40 million settlement money, Murkowski argued.

"These Outside lawyers came to Alaska, convinced the fishermen they could win a billion dollars, and lost," Murkowski said in a Nov. 14 news release. "Now they hope to take away $12 million in fees, on top of $4.5 million in costs. I believe the fees should be shared by those who have been hurt by this exercise in poor judgment, namely, the fishermen and the processors."

Public Interest.

In a motion filed on Nov. 25, the state Department of Law argued that the public interest is strong enough to warrant intervention to address the attorneys' fee issue. The Bristol Bay region in recent years has suffered through successive economic disasters because of poor prices and, at times, poor salmon returns, the motion said.

"If additional proceeds from the settlement are paid to Bristol Bay fishermen instead of class counsel, it may help alleviate some of the economic stress suffered by this fishery. There can be no disagreement that the infusion of millions of dollars into this fishery will have positive economic benefits to the state." Even though class members will be able to object to the settlement distribution, the motion said, "the vast majority will not comprehend the complexities involved in determining a reasonable division of settlement proceeds, or have the ability to raise legal challenges to the split of attorney's fees."

If the state is not allowed to intervene, the motion said, it should be granted permission to file an amicus brief to support its position in favor of changing the settlement formula.

Settlement Awards $16.5 Million in Fees.

The settlement formula was described in an agreement filed in state Superior Court on Nov. 3. That agreement would distribute $13.8 million of the settlement money to the defendant seafood companies and their attorneys. Under the proposed arrangement, the rest of the settlement would be divided between fishermen and plaintiff attorneys. In addition to providing $16.5 million to the plaintiff attorneys, it would distribute an average of $2,145 to each fisherman in the plaintiff class.

Attorneys on both sides of the Bristol Bay case said Murkowski's efforts to change the settlement formula were baseless.

"I think it's inappropriate political grandstanding by the governor," said plaintiffs' attorney Phil Weidner of Anchorage. "I think it's ill-advised and inappropriate."

Aside from the state's motion to intervene, Weidner said he knew of no formal objection to the settlement distribution plan.

Jeff Feldman, who represents defendant Trident Seafoods, said he did not see a legal justification for allowing the state to interfere with the distribution of settlement proceeds.

"I'm doubtful that the state has standing to participate," said Feldman, of Anchorage-based Feldman & Orlansky. The state has not been a party to the lawsuit in the past, and "they have no direct interest in the issue that is before the court," he said.

Participants on both sides of the lawsuit probably wanted a larger share of the settlement money, but they have come to a satisfactory agreement nonetheless, Feldman said. "That settlement reflects some substantial amount of compromise on everybody's part, but that's always the case," he said.

Litigation Grew Out of Protests.

The price-fixing lawsuit grew out of fishermen's protests in 1991 over prices paid to them for salmon caught in southwestern Alaska's Bristol Bay region, site of the world's biggest natural sockeye runs. In 1988, fishermen were commonly paid over $2 a pound for the salmon, but those payments dropped to 50 cents a pound by 1991.

The suit charged nearly three dozen processors and importers with conspiring to keep prices for Bristol Bay salmon artificially low form 1991 to 1995.

The defendants said other factors accounted for the sharp drop in dockside salmon prices. Chief among them was new competition from rapidly expanding salmon farms, according to the defendants.

Before the trial started on Feb. 3, 17 of the defendants paid $25 million into a settlement fund. Two days after opening arguments started, Marubeni Corp. and its associated companies also settled, adding $15 million to that fund.

Plaintiffs' attorneys included the Susman Godfrey firm of Los Angeles and the Furth Firm of San Francisco.

Defense attorneys included the Summit Law Group of Seattle, and Perkins Coie and Dorsey & Whitney, both multi-location firms that maintain offices in Anchorage.

By Yereth Rosen