                             In the
 United States Court of Appeals
               For the Seventh Circuit
                          ____________

No. 04-3140
DANIEL JT TAUBENFELD and
RAIZEL TAUBENFELD,
                                            Plaintiffs-Appellees,
                                v.
AON CORP.,
                                             Defendant-Appellee.

Appeal of: HANNAH FELDMAN


                          ____________
        Appeal from the United States District Court for the
          Northern District of Illinois, Eastern Division.
         No. 02 CV 5631—Harry D. Leinenweber, Judge.
                          ____________
     ARGUED MARCH 30, 2005—DECIDED JULY 5, 2005
                   ____________




  Before BAUER, RIPPLE, and KANNE, Circuit Judges.
  KANNE, Circuit Judge. On August 8, 2002, the first of ten
class action lawsuits alleging that Aon Corporation had
violated federal securities laws was filed in the Northern
District of Illinois. In October 2002, the court appointed
Caldwell & Orkin, Inc., as the lead plaintiff for the consoli-
dated actions. Caldwell & Orkin had no retainer agreement
in place with its chosen lead council, Shiffrin & Barroway.
2                                                No. 04-3140

The parties reached a settlement agreement on April 14,
2004. After a fairness hearing on July 27, 2004, the court
approved the $7.25 million settlement, which provided
recovery of $0.053 per share of Aon common stock before
fees and expenses.
  The class was given written notice of this settlement
agreement and informed of members’ right to file objections
to it. On the subject of attorneys’ fees and expenses, the
notice stated that lead counsel intended to apply for “fees of
up to 33 and 1/3 percent (33.3%) of the Settlement Fund,
and for reimbursement of expenses incurred in connection
with the prosecution of this Action in the approximate
amount of $100,000.” (R. 38, Ex. A.1 ¶ 7.) Hannah Feldman
was the lone class member to object to the settlement
agreement. She alleged both inadequate notice and exces-
sive fees relative to the level of success achieved by the
class. The district court overruled her objection and
awarded lead counsel the fees and expenses it requested:
30% of the settlement fund plus $111,054.06 in expenses.
  Feldman does not appeal the district court’s ruling on
adequacy of notice, arguing now only that the fees and ex-
penses awarded to lead counsel were excessive. Her primary
argument is that the district court’s method for determining
proper attorneys’ fees and expenses was improper under In
re Synthroid Marketing Litigation, 264 F.3d 712 (7th Cir.
2001) (“Synthroid I”). In that case, we reiterated that “when
deciding on appropriate fee levels in common-fund cases,
courts must do their best to award counsel the market price
for legal services, in light of the risk of nonpayment and the
normal rate of compensation in the market at the time.” Id.
at 718; see also Florin v. Nationsbank of Ga., N.A., 34 F.3d
560, 565 (7th Cir. 1994) (directing district court to deter-
mine fair attorneys’ fees in class action by considering the
probability of success at the outset of litigation); In re
Continental Ill. Sec. Litig., 962 F.2d 566, 572 (7th Cir. 1992)
(“The object in awarding a reasonable attorney’s fee . . . is
No. 04-3140                                                   3

to give the lawyer what he would have gotten in the way of
a fee in an arm’s length negotiation, had one been feasi-
ble.”). Although is it impossible to know ex post exactly what
terms would have resulted from arm’s-length bargaining ex
ante, courts must do their best to recreate the market by
considering factors such as actual fee contracts that were
privately negotiated for similar litigation, information from
other cases, and data from class-counsel auctions. Synthroid
I, 264 F.3d at 719. In this case, Feldman argues, the district
court’s consideration of the Synthroid I factors was inade-
quate and amounted to a “benchmark” approach in which
counsel is awarded exactly what attorneys in other cases
were awarded, regardless of the risk present or result
achieved in this particular case.
  Unfortunately for the objector, she did not articulate her
argument regarding fee-setting methodology to the court
below. Instead, she cited only the lower court’s Synthroid
opinion (on remand from Synthroid I) for the fact that bids
as low as 15% for contractual attorneys’ fees have been ob-
served in cases where law firms participated in an auction
for the position of lead counsel. See In re Synthroid Mktg.
Litig., 201 F. Supp. 2d 861, 873 (N.D. Ill. 2002), aff’d in part
and vacated in part by 325 F.3d 974 (7th Cir. 2003)
(“Synthroid II”). Feldman’s written objection contained
conclusory allegations that 33% of the settlement fund
would be a “grossly excessive” fee in light of the “very poor
settlement obtained for the class,” but did not address or
propose a proper fee-setting methodology. (R. 41.) Even
when asked point blank for an elaboration of the objection
to attorneys’ fees at the fairness hearing, Feldman’s counsel
did not raise the argument that the court had not ade-
4                                                      No. 04-3140

quately re-created the market in assessing fees.1 Thus,
Feldman has waived the argument that the district court
did not comport with the methodology mandated by
Synthroid I in granting attorneys’ fees. See, e.g., Heller v.
Equitable Life Assurance Soc’y, 833 F.2d 1253, 1261-62 (7th
Cir. 1987) (“On numerous occasions we have held that if a
party fails to press an argument before the district court, he
waives the right to present that argument on appeal. . . . As
we have made clear, it is axiomatic that arguments not
raised below are waived on appeal.”) (citations and quota-
tion marks omitted).
  Noting that lead counsel’s memorandum to the district
court in support of its application for fees and expenses
contained an analysis of the strength of the class’s case,
data on fees awarded in other class actions in the jurisdic-
tion, and evidence of the quality of legal services rendered—
the same type of evidence needed to mimic the market per
Synthroid I—we decline to undertake the de novo review of
the procedure used to arrive at the award to which the
objector would have been entitled if she had not waived the
argument. See Harman v. Lyphomed, Inc., 945 F.2d 969,
973 (7th Cir. 1991).
  We proceed to review the award for abuse of discretion;
under that standard, the award must be reversed if it can-
not be rationally supported by the record. See id. As we said
in Harman, “[d]istrict courts are far better suited than


1
    The transcript reads as follows:
        THE COURT: Counsel, your objection?
        MR. BOGOT: Your Honor, I really don’t have much more to
      add than what is in our brief. In some cases thirty percent is
      reasonable. It depends on the case. Considering the amount of
      settlement here, I think there are grounds to object but I will
      just stand on our objection.
(Tr. at 10.)
No. 04-3140                                                  5

appellate courts to assess a reasonable fee in light of the
case’s history.” Id. In this case, the district court based its
decision on a number of factors adequately supported by the
record.
  First, the court considered awards made by courts in
other class actions. Lead counsel submitted a table of thir-
teen cases in the Northern District of Illinois where counsel
was awarded fees amounting to 30-39% of the settlement
fund. (R. at 44.) These data are relevant for purposes other
than “benchmarking” as defined by the objector; attorneys’
fees from analogous class action settlements are indicative
of a rational relationship between the record in this similar
case and the fees awarded by the district court.
   The district court also evaluated other factors in its deci-
sion on attorneys’ fees. It considered the quality of legal
services rendered and the contingent nature of the case.
The court found that lead counsel was taking on a signifi-
cant degree of risk of nonpayment with the case. (Tr. at 11
(“[T]he Court believes that counsel adequately pressed this
suit and took it on a contingent basis. [In t]hese cases,
obviously, [it is] not easy to prove securities fraud. You have
to prove fraud. Usually it’s negligence rather than fraud.”).)
Indeed, an SEC investigation essentially cleared Aon of any
perceived wrongdoing and bolsters the finding that this was
not an “easy” case for lead counsel. (R. at 44.) Given the
legal hurdles that lead counsel faced in proving liability, the
$7.5 million settlement obtained for the class at a relatively
early point in time also seems reasonable and bears a
rational relationship to the amount of attorneys’ fees
awarded. See Donovan v. Estate of Frank E. Fitzsimmons,
778 F.2d 298, 309 (7th Cir. 1985) (noting the risk of losing
on the merits and the time value of money among the
factors to be considered in evaluating the reasonableness of
a settlement). In light of this record, it cannot be said that
there is no evidence supporting the attorneys’ fees granted
in this case or that the district court abused its discretion
in making the award.
6                                             No. 04-3140

  The objector’s quarrel with the portion of lead counsel’s
award pertaining to reimbursement for expenses barely
warrants comment. Feldman argues that the class was only
given notice for fees in the amount of $100,000, but lead
counsel was actually awarded $111,054.06. Again, Feldman
did not make this argument in the district court and has
thus waived it. See, e.g., Heller, 833 F.2d at 1261-62.
Moreover, this argument would have been meritless; notice
was given for expenses “in the approximate amount of
$100,000” and the amount awarded is in fact “approxi-
mately” that much.
  For the foregoing reasons, lead counsel’s award for fees
and expenses is AFFIRMED.

A true Copy:
      Teste:

                       ________________________________
                       Clerk of the United States Court of
                         Appeals for the Seventh Circuit




                   USCA-02-C-0072—7-5-05
