By Mike Scarcella

WASHINGTON, March 13 (Reuters) - A federal judge in New York agreed to grant $3.16 million in legal fees for lawyers who sued Kimberly‑Clark (KMB.O) over the labeling of its “flushable” wipes, dismissing objections that the attorneys would earn more than the consumers they represented in the class action.

U.S. District Judge Pamela Chen in Brooklyn on Thursday approved the fees as part of a settlement in the case that netted class members $1 million, finding that the deal was fair, reasonable and adequate.

The 2nd U.S. Circuit Court of Appeals vacated the settlement and sent the fee dispute back to Chen for a second look last year, saying the judge needed to more fully consider the balance between the attorney fees and the damages the class received. The appeals court did not say how much the attorneys should get.

Chen in her new ruling said the fee “ratio in this case raises superficial concerns,” but other factors support the settlement’s overall fairness.

Kimberly-Clark and the lead plaintiffs lawyers did not immediately respond to requests for comment.

The lawsuit, filed in 2014, accused Kimberly‑Clark of mislabeling wipes as “flushable” despite their potential to clog and damage plumbing. The company has denied wrongdoing and says its products perform as advertised.

Kimberly‑Clark agreed in 2022 to pay up to $20 million to resolve the case. But by the claims deadline, consumers had sought only about $1 million, leaving roughly $19 million unclaimed and retained by the company.

Ted Frank, a conservative public interest lawyer and director of the non-profit Hamilton Lincoln Law Institute, challenged the settlement and the attorneys' fees, telling the lower court and 2nd Circuit that the fee award violates "intuitive notions of justice."

Frank on Friday said he plans to further appeal Chen's latest order.

“The court erred in thinking of this as an attorney fee dispute in isolation, rather than looking at the holistic problem of class counsel self-dealing at the expense of their clients,” Frank said.

He said it is “fundamentally unfair for attorneys to negotiate full compensation for themselves at three times total class compensation while leaving the vast majority of the class with nothing.”

Chen in her order said the fee reflects “extensive” work by the plaintiffs' lawyers over many years and that the nature of the case, involving a low‑cost consumer product, meant “the potential recovery for class members was inherently and unavoidably limited.”

The case is Kurtz v. Kimberly-Clark Corp et al, U.S. District Court, Eastern District of New York, No. 1:14-cv-01142-PKC-RML.

For plaintiffs: Samuel Rudman and Vincent Serra of Robbins Geller Rudman & Dowd LLP

For objector: Anna St. John of Hamilton Lincoln Law Institute

Read more:

US appeals court says law firm's size doesn't limit legal fees

As lawyer rates surge, US firm charges $4,000 an hour for top partners

Lawyers face objections to multimillion-dollar fees after no-cash settlement with Schwab

(Reporting by Mike Scarcella)

((Email: mike.scarcella@thomsonreuters.com; Phone: 202-985-8228.))