The opinion of the court was delivered by: JONES
WILLIAM B. JONES, District Judge.
Petitioners Thomas H. Carolan and Philip W. Amram have applied to the Court to award them fair compensation equal to the fair value of the services which they claim that they, as members of the bar of this Court, rendered to plaintiffs and similarly situated persons. They seek to have this award made out of a fund resulting from the vesting in the Alien Property Custodian in 1943 of the assets of the Yokohama Specie Bank, Ltd. They do not ask for any part of that fund which will be necessary to pay the plaintiffs and others similarly situated under the consent judgment entered herein on July 6, 1967, which sum is estimated to be $10,500,000. They seek to be paid out of the residue of the vested assets.
To understand the significance of petitioners' request it is necessary to review briefly this litigation and Abe v. Kennedy, Civil Action No. 2529-61, United States District Court for the District of Columbia, 228 F. Supp. 706.
In both actions the named plaintiffs sued on their own behalf and on behalf of all persons similarly situated. The class plaintiffs in each case were several thousand Americans of Japanese ancestry who prior to December 7, 1941 had deposited dollars in California and Washington branches of the Yokohama Specie Bank, Ltd., a Japanese bank. Following the outbreak of war with Japan the American assets of that bank were vested in the Alien Property Custodian
pursuant to the Trading with the Enemy Act, 50 U.S.C.App. § 1, et seq. In 1946 Congress enacted § 34 of that Act (50 U.S.C.App. § 34) which provided that vested property, or the net proceeds thereof, were to be equitably applied by the Alien Property Custodian to the payment of debts owed by the person who owned such property immediately prior to its vesting in the Custodian. The depositors with the Yokohama Bank were creditors to the extent of their deposits and beginning in 1947 some 7500 claims based on yen deposits were timely filed.
After extensive hearings before an examiner, the Alien Property Custodian in 1957 ruled that the claims were allowable at the rate of 361.55 yen to the dollar. The 7500 claimants were advised of this ruling and were directed to submit within forty-five days their original yen certificates which had been issued by the Bank or, in the event of loss of the certificates, other proofs of the debt owed. The claimants were also advised that if such certificates or other proofs were not submitted within the forty-five days the claims would be dismissed as having been abandoned. The same communication further stated to the 7500 claimants that a schedule of claimants would be drawn up from the names of the persons submitting their certificates or other proofs and that within sixty days after the issuance of the schedule any aggrieved claimant could file in this Court a complaint for review of the schedule in which action the Attorney General would be the defendant.
1817 claimants submitted, within the prescribed time, original certificates of deposit or other proof. The 4100 claimants who are the plaintiffs in this Honda case, did not submit their certificates or other proofs and they were informed that their claims were denied as abandoned. In 1961 a final schedule was prepared and sent to all claimants, including these 4100 who were not included in the schedule but who were advised that they could within sixty days file a complaint in this Court for a review of the schedule.
In August 1961, Abe v. Kennedy, C.A. 2529-61 was instituted in this Court on behalf of the 1817
claimants whose claims had been allowed at the rate of 361.55 yen to the dollar. In the Abe case the plaintiffs claimed that the deposit debts owed them should be paid in dollars at the rate of 23.4 cents for each yen rather than at the rate of 361.55 yen per dollar allowed by the Custodian. A case filed in 1958 by depositors of the Sumitomo Bank raised the same issue. Proceedings in the Abe action were postponed pending the outcome of the earlier case, Aratani v. Kennedy, C.A. 3164-58. In that case this Court granted summary judgment in favor of the defendant. On appeal that judgment was affirmed. 115 U.S.App.D.C. 97, 317 F.2d 161, modified 115 U.S. App. D.C. 106, 323 F.2d 427 (1963). After the Supreme Court granted certiorari in Aratani, the Attorney General entered into a compromise settlement with the plaintiffs in both Aratani and Abe. Judge Walsh of this Court on March 17, 1964 entered an interlocutory order approving the compromise and on May 18, 1964 entered a final order. Petitioners Carolan and Amram represented both the Aratani and Abe plaintiffs. As a part of the compromise settlement they were awarded as attorneys fees for themselves and other counsel associated with the $1,279,071.51 from the Yokohama funds and $242,761.99 from the Sumitomo funds, which sums constituted 20% of the consent judgments entered in Abe and Aratani. Over $11,000,000 remains in the Yokohama fund after payment of the compromise judgment and attorneys' fees in Abe.
On May 19, 1964, this Honda action was brought on behalf of the 4100 Yokohama Bank depositors, whose claims were denied as abandoned by the Custodian in 1961.
The plaintiffs sought a declaratory judgment that defendant's dismissal of their claims as abandoned was illegal and that they be paid at the same conversion rate as the plaintiffs in Abe v. Kennedy. Defendant, after answering the complaint, moved to dismiss on the ground that the Court lacked jurisdiction over the subject matter of the action because it was not commenced within sixty days after the Custodian's schedule was mailed to the plaintiffs in August 1961 as required by 50 U.S.C.App. § 34(f). This Court granted that motion and the dismissal was affirmed by the Court of Appeals. 123 U.S.App.D.C. 12, 356 F.2d 351 (1966). The Supreme Court reversed, holding that the statutory scheme of § 34 of the Trading with the Enemy Act required tolling the limitation period during the pendency of the Abe litigation. 386 U.S. 484, 500, 502, 87 S. Ct. 1188, 18 L. Ed. 2d 244 (1967).
Following the reversal by the Supreme Court a consent judgment was entered in this case on July 6, 1967, upon the joint motion of the plaintiffs and defendant. That judgment and decree provided for payment of the claim at the conversion rate of 0.26133 cents per yen. It also awarded attorneys' fees in the amount of $950,000.00 to plaintiffs' counsel. Petitioners here did not represent the plaintiffs in the Honda litigation and, of course, will receive no part of the $950,000.00 fees. As awarded to counsel of record in this case, the fee will be less than 10% of the amount recovered for plaintiffs, according to the best estimate of counsel for defendant as well as plaintiffs' counsel.
As noted the first ground for petitioners' claim of right to a fee is that their services in the Abe litigation were used in overcoming the bar of the statute of limitations by Honda. They point to the Supreme Court decision and opinion in this case. There the Court said "we hold that the statutory scheme [§ 34] itself requires tolling the limitation period during the pending of the Abe litigation." 386 U.S. at 500, 87 S. Ct. at 1197. The Supreme Court stated that the model for § 34 of the Trading with the Enemy Act was the Federal Bankruptcy Act and that under the latter a creditor who failed to file a timely claim did not lose all rights; rather such an untimely claim could be paid out of the surplus, if any, remaining in the bankrupt's estate after all timely filed claims had been paid in full. This, of course, could result in the untimely claimant receiving nothing if there were no remaining surplus or in an amount less than that claimed if the remaining surplus was not sufficient to pay the untimely claims in full. Here it appears that the Honda claims can be paid in full at the consent judgment rate because the surplus Yokohama funds will be sufficient to meet such demands. But such is not the case of Honda type claimants to the Sumitomo Bank vested assets. Those assets were exhausted by the Aratani plaintiffs, who like the Abe plaintiffs, filed their action within the sixty day limitation provided in § 34. Aratani v. Kennedy, 228 F. Supp. at 708. Honda type claimants to the Sumitomo assets can recover nothing on their claims.
Since petitioners were counsel of record for the plaintiffs in both the Abe and Aratani cases, it is difficult to understand how it can be said that their services in Abe were used by the Honda plaintiffs to toll the statute of limitations. They do not contend that the Abe case was instituted for that purpose. Indeed if they had the Honda plaintiffs in mind it would have been simple to have either stated a second claim in the Abe complaint or to have filed a separate action within the sixty day statutory period in which to assert the Honda claims.
And there is no showing that petitioners in August 1961, when they filed the Abe complaint, knew that the Yokohama fund would be in excess of the total amount claimed by the 1817 Abe plaintiffs' claims. Thus, even if petitioners were acting to toll the statute for Honda claimants by filing the Abe action, for all they knew the Honda claims would be as uncollectible as the claims of the similarly situated claimants to the Sumitomo fund.
Petitioners' contention that their services were used to toll the statute of limitations on behalf of the Honda plaintiffs is without merit.