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April 16, 1981

In the Matter of the Complaint of CAP'N RICK CORP., Plaintiff, as Owner of the F/V CAP'N RICK, for Exoneration from or Limitation of Liability; EOLLA VIVENTI, as Executrix and Personal Representative of the Estate of PETER A. VIVENTI, Deceased Plaintiff, against CAP'N RICK CORP. Defendant

The opinion of the court was delivered by: SWEET

Sweet, D.J.

On January 12, 1975 the fishing vessel CAP'N RICK rolled over and sank during a turn while engaged in clamming east southeast of Chesapeake Light Tower. Two crew members were drowned, Captain Peter A. Viventi and Adalbert Brodowski. What happened thereafter in actions brought under the Death on the High Seas Act, 46 U.S.C. § 761 et seq., and Jones Act, 46 U.S.C. § 688 et seq., has brought little credit to the legal process or to certain members of the bar who have represented the representatives of the dead fishermen.

 This memorandum opinion and order sets forth the basis of the court's approval of the settlement and the allocation of attorneys' fees, all of which were the subject of a hearing on December 3, 1980.

 On December 22, 1980 this court approved the settlement of the claims of Joseph Wegrzyn the representative of Adalbert Broadowski; and Eolla Viventi, as executrix and personal representative of the estate of Peter H. Viventi. That settlement terminated the exoneration proceedings in the matter of the complaint of the CAP'N RICK CORP., 75 Civ. 3362, the action brought by Mrs. Viventi, Eolla Viventi v. CAP'N RICK CORP., 76 Civ. 3581 and the claim on behalf of Brodowski's estate, Joseph Wegrzyn v. Cap'n Rick Corp., 76 Civ. 3582. The only asset of the CAP'N RICK CORP. was its insurance coverage in the amount of $ 500,000, the proceeds of which provided the settlement funds. This relatively simply resolution, almost six years after the event, is the final outcome of a process in which unsophisticated plaintiffs have been ill-served by over-reaching attorneys who may well have failed to represent their interests fully and adequately. The court and its processes must share the blame for the delay in recognizing the nature of the situation and in accomplishing the relief finally granted. These conclusions compel a recital of the history of these proceedings.

 On August 12, 1976 Wegrzyn commenced his action represented by George Cappiello of Phillips & Cappiello. The Viventi action was also instituted on that day. Mrs. Viventi was originally represented by the law firm of Freedman, Borowsky & Lorry, Pennsylvania counsel. Ned Phillips ("Phillips") of Phillips & Cappiello was also associated with that firm. The matter had been referred to Freedman by Joshua Davidow ("Davidow"), a New Jersey attorney in Bridgeton, New Jersey.

 The Wagrzyn and Viventi actions were thereafter stayed pending the outcome of the exoneration proceeding.

 On June 5, 1978 the actions were reassigned to me. By opinion entered on November 8, 1978 discovery deadlines were set. In the meantime, Phillips continued to represent the plaintiffs in the Wegrzyn and Viventi actions and in the exoneration proceedings.

 By the summer of 1978 a proposed settlement had been agreed upon by counsel providing for the payment of $ 315,000 to the Viventi's. Mr. Phillips sought to enforce the settlement, Mrs. Eolla Viventi having agreed to it informally. By memorandum opinion of November 3, 1978, the motion was denied. Mrs. Viventi, the mother of Peter Viventi, had consulted another New Jersey attorney, Donald Shapiro ("Shapiro"), who had advised her not to accept the settlement. Thereafter the firm of Fuchsberg & Fuchsberg was substituted for Phillips to represent the Viventi interests.

 Harvey Goldstein ("Goldstein") of the Fuchsberg firm undertook to prepare the action and a series of orders was entered adjourning the date for filing a pre-trial order to January 2, 1980. On February 13, 1980 the parties appeared for trial on the exoneration proceeding and announced that a settlement had been reached. An order was signed to that effect.

 Thereafter, predictably, difficulties arose in connection with attorneys' fees and an application was made for approval of the settlement, allocation of fees and the appointment of a guardian ad litem to protect the interests of the children of Peter Viventi. This motion was granted and on June 27, 1980 Eliot H. Lumbard, Esq. ("Lumbard") was appointed Special Guardian. His report was filed on October 24, 1980, and a hearing was held on December 3, 1980.

 These proceedings have established that Mrs. Viventi initially consulted the firm of Davidow, Sherman & Eddower in Bridgeton, New Jersey, and, by way of referrals from that firm, eventually retained Phillips. Phillip's original retainer provided for a 40% contingency fee. When the amount of the Phillips fee became the subject of discussion, the contingent fee was reduced to 33 1/3%. The Guardian ad litem reported that the intended distribution of the settlement, $ 430,000.00 in all, divided between Eolla Viventi ($ 35,000), Olive Viventi, widow of Peter ($ 188,500), a trust for Dion Viventi, son of Peter ($ 28,000) and a trust for Robin Viventi, daughter of Peter ($ 26,500), is fair to the minors.

 However, the report of the guardian ad litem sets forth certain facts upon which it is suggested that a claim could have been made against the principal shareholder of the CAP'N RICK CORP., Arthur Richard Meyers who was apparently the owner and operator of the CAP'N Rick and other fishing vessels, one of which, the MARY JANE, was lost under similar circumstances on December 11, 1973. There is apparently reason to believe that both vessels had been altered by Meyers in such fashion as to affect their stability. Had such proof been adduced, exoneration might have been denied under 46 U.S.C. § 183. However, no evidence was presented here that such a denial would have increased the Viventi's recovery. The settlement was therefore approved by order dated December 22, 1980 and entered on December 24, 1980.

 Pursuant to that order, $ 139,000 was set aside for fees. An additional $ 13,000 has been held in escrow for reimbursement of expenses. Both the Phillips and Fuchsberg firms claim nearly the entire fee amount. Fuchsberg acknowledges that a portion of this fee and certain expenses should be allowed to Shapiro, who performed certain services for the plaintiffs although he did not participate-in the ...

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