Strack “Guidelines,” Not Caps: Oklahoma Class-Action Fee Awards May Exceed 30% / 1.5 When Statutory-Factor Supported

1. Introduction

Case: Chieftain Royalty Company v. Enervest Energy Institutional Fund XIII-A, Nos. 24-6227 & 24-6228 (10th Cir. Jan. 26, 2026).
Parties: Chieftain Royalty Company (class representative for Oklahoma royalty owners) vs. EnerVest-related entities and FourPoint Energy (operators/marketers). Objectors-Appellants: Danny George and the Estate of Charles David Nutley.
Core dispute on this (third) appeal: whether a reinstated class-action fee award of 33.33% of a $52 million common fund ($17,333,333.33) is “unreasonable” under Oklahoma law—particularly after Strack v. Continental Resources, Inc., 507 P.3d 609 (Okla. 2021).

The case’s merits resolved long ago: the parties settled in 2015, creating a $52 million common fund for underpaid oil-and-gas royalties. The litigation’s afterlife has been dominated by attorney-fee methodology, notice, and the proper application of Oklahoma’s class-action fee statute (Okla. Stat. tit. 12, § 2023(G)).

2. Summary of the Opinion

The Tenth Circuit affirmed the district court’s attorney-fee order. The court held that Oklahoma law (as articulated in Strack) requires reasonableness, not adherence to rigid ceilings. It rejected the objectors’ principal contentions that:

  • Strack imposes an effective cap of 30% (percentage method) and 1.5 (lodestar multiplier);
  • the district court “reverse engineered” a lodestar multiplier to match its percentage award;
  • the lodestar base was improperly inflated by including “fees-on-fees” (time spent defending the fee award, including rehearing and certiorari efforts);
  • reconstructed time records were categorically inadequate under Oklahoma law; and
  • the district court misapplied Oklahoma’s statutory factors, including by “double counting.”

The panel emphasized the deferential abuse-of-discretion standard and concluded the district court conducted a thorough, evidence-supported analysis of Oklahoma’s statutory factors and a proper lodestar cross-check.

3. Analysis

3.1 Precedents Cited (and How They Shaped the Decision)

  • Chieftain Royalty Co. v. Enervest Energy Inst. Fund XIII-A, L.P. (Chieftain I), 888 F.3d 455 (10th Cir. 2017)
    Role: Established that in diversity class actions, state law governs fee availability and calculation. It also made an “Erie guess” that Oklahoma required a lodestar-only approach and rejected percentage-of-the-fund and percentage-based incentive awards. This appeal is part of the long arc of correcting course after later Oklahoma clarification.
  • Strack v. Continental Resources, Inc., 507 P.3d 609 (Okla. 2021)
    Role: The centerpiece. Strack clarified Oklahoma’s framework: courts may use either percentage-of-the-fund or lodestar, but must arrive at a reasonable fee and must consider the statutory factors in Okla. Stat. tit. 12, § 2023(G)(4)(e), with a cross-check against the alternative method. The objectors tried to convert Strack’s reported “average” ranges (20–30% and multipliers “rarely” above 1.5) into quasi-caps. The Tenth Circuit refused.
  • Chieftain Royalty Co. v. SM Energy Co. (Chieftain II), 100 F.4th 1147 (10th Cir. 2024)
    Role: Vacated the fee award on procedural notice grounds without reaching merits. In the present appeal, the district court reinstated its prior substantive fee analysis after new notice; the objectors then attacked the merits.
  • State ex rel. Burk v. City of Oklahoma City, 598 P.2d 659 (Okla. 1979)
    Role: Crucial for two issues: (1) Oklahoma’s lodestar tradition and recordkeeping admonition; (2) the “fees-on-fees” principle—allowing compensation for reasonable time spent applying for and defending a fee award. The panel relied on Burk to reject the objectors’ attempt to exclude appellate fee-defense time, while acknowledging the issue was “close” as to extraordinary petitions.
  • Parsons v. Volkswagen of Am., Inc., 341 P.3d 662 (Okla. 2014)
    Role: Confirmed Oklahoma’s “strong presumption” that lodestar alone is reasonable and underscored the relevance of “results obtained.” The panel used Parsons both to reinforce Oklahoma’s view of results/amount-in-controversy and to rebut an objector’s attempt to analogize fee-defense work to unrelated litigation.
  • Spencer v. Okla. Gas & Elec. Co., 171 P.3d 890 (Okla. 2007) and Conti v. Rep. Underwriters Ins. Co., 782 P.2d 1357 (Okla. 1989)
    Role: Both disavow a rigid reading of Burk on time records. They expressly allow fee awards based on reconstructed time records if the record is adequate to assess reasonableness—undercutting the objectors’ argument that reconstruction is categorically prohibited.
  • Gottlieb v. Barry, 43 F.3d 474 (10th Cir. 1994)
    Role: Cited via Strack for the pragmatic proposition that the method chosen should be the one that best arrives at a reasonable award under the case’s circumstances.
  • Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir. 1974)
    Role: Source of the twelve-factor framework that Oklahoma codified (with one additional risk factor) in § 2023(G)(4)(e). The panel emphasized that Oklahoma requires more than a cursory recitation: a factor-by-factor evidentiary analysis.
  • Blum v. Stenson, 465 U.S. 886 (1984)
    Role: The objectors invoked Blum (federal fee-shifting context) to argue “results obtained” is subsumed and should not independently enhance. The panel distinguished this by pointing to Oklahoma law’s long recognition of the amount/results relationship and by noting the district court used multiple factors.
  • Anderson Living Tr. v. WPX Energy Prod., LLC, 904 F.3d 1135 (10th Cir. 2018)
    Role: Supported the district court’s emphasis on the difficulty/importance of class certification (“make or break”), which helped justify a modest upward deviation from Strack averages.
  • Miller v. Magnus, 452 P.3d 440 (Okla. Civ. App. 2019)
    Role: Cited by objectors for a “contribution to recovery” notion, but the panel treated it as an apportionment case, not a reasonableness limitation on fee-defense time.
  • Schell v. OXY USA Inc., 814 F.3d 1107 (10th Cir. 2016), ClearOne Commc'ns, Inc. v. Biamp Sys., 653 F.3d 1163 (10th Cir. 2011), Moothart v. Bell, 21 F.3d 1499 (10th Cir. 1994), and related citations (McEwen v. City of Norman; United States v. Wright)
    Role: Provided the appellate review structure: legal questions de novo, fact findings for clear error, overall fee award for abuse of discretion—framework that drove the affirmance given the district court’s detailed record-based findings.
  • Kitchen v. Herbert, 755 F.3d 1193 (10th Cir. 2014) and Cook v. Rockwell Int'l Corp., 790 F.3d 1088 (10th Cir. 2015)
    Role: Supported the forfeiture holding: an argument not raised in an earlier appeal cannot be introduced on remand (here, the objectors’ late “statutory interest” amount-in-controversy contention).
  • Cooter & Gell v. Hartmarx Corp., 496 U.S. 384 (1990) and Penncro Assocs., Inc. v. Sprint Spectrum, L.P., 499 F.3d 1151 (10th Cir. 2007)
    Role: Reinforced deference to district court factfinding and clarified that pointing to conflicting evidence does not establish clear error.
  • Int'l Precious Metals Corp. v. Waters, 530 U.S. 1223 (2000) (O'Connor, J., statement concerning denial of certiorari)
    Role: Provided the “rational relationship” touchstone between fee and recovery, folded into the court’s understanding of Oklahoma’s reasonableness inquiry as described in Strack.

3.2 Legal Reasoning

A. The “New” Clarification: Strack’s ranges are guides, not ceilings

The opinion’s most durable contribution is its clarification of how Strack functions in real-world review: the “20% to 30%” percentage range and the statement that Oklahoma “rarely” permits multipliers above 1.5 are not hard limits. The panel read Strack as preserving trial-court discretion—so long as the court (i) analyzes all thirteen statutory factors, (ii) looks beyond a cursory checklist, (iii) grounds deviations in evidence, and (iv) cross-checks using the alternative methodology.

The panel rejected a key objector move: turning Strack’s example (“for example . . . when the fund is extraordinarily large or small relative to the hours”) into an exclusive rule. The Tenth Circuit treated it as illustrative of how factors interplay, not a gatekeeping condition on any deviation.

B. Percentage award upheld: 33.33% can be reasonable with record support

The district court did not rubber-stamp the requested 40%. It reduced the request and then justified 33.33% by finding, among other points, (i) “nearly complete success” (including recovery of roughly 100% of claimed underpayment principal), (ii) significant litigation risk (complex leases, unsettled substantive issues, oil-and-gas volatility), and (iii) unusual skill in navigating an evolving class-certification landscape in federal court. The panel held that these distinctions were legitimate bases to depart modestly above the statistical “average range.”

C. Lodestar cross-check upheld: identifying the “needed multiplier” is not improper “reverse engineering”

The objectors argued that computing a multiplier to match the percentage award is forbidden “reverse engineering,” invoking criticism in Strack. The panel responded with a functional point: a lodestar cross-check necessarily computes what multiplier would equate the two methods and then asks whether that multiplier is reasonable under the statutory factors. What Strack condemned was not equivalence per se, but adopting a large multiplier without evidence or meaningful factor analysis.

D. “Fees-on-fees” included: appellate fee-defense time may be compensable if reasonable

Applying Burk, the panel held Oklahoma generally permits reasonable time spent applying for and defending fees. It treated petitions for rehearing and certiorari as a “close issue” given their extraordinary nature and low success rates, but upheld inclusion because the district court carefully evaluated reasonableness, relied on expert testimony, and noted counsel’s legal position was later vindicated by Strack.

E. Reconstructed time records allowed under Oklahoma law

The panel rejected a categorical exclusion argument, relying on Spencer v. Okla. Gas & Elec. Co. and Conti v. Rep. Underwriters Ins. Co. to confirm that reconstructed records can support a fee award if they create an adequate record for reasonableness review.

F. Factor analysis and “double counting”: discounting is enough; perfection is not required

The objectors claimed several factors were subsumed within the lodestar and thus could not support enhancement. The panel credited the district court’s approach: it expressly recognized potential overlap and discounted weight accordingly. Under abuse-of-discretion and clear-error review, that was sufficient.

G. Procedural discipline: forfeiture blocks new “amount in controversy” theories on remand

The objectors attempted to reframe “results obtained” by arguing the district court ignored statutory interest (Okla. Stat. tit. 52, § 570.10(D)(1)) when measuring the amount in controversy. The panel held the argument was forfeited because it could have been raised earlier (during the prior appeal cycle), and under Cook v. Rockwell Int'l Corp. forfeited issues cannot be introduced on remand.

3.3 Impact

  • Operational rule for federal courts applying Oklahoma law: Strack’s percentage and multiplier ranges are benchmarks, not binding caps. Courts may exceed them if the § 2023(G)(4)(e) factors, supported by evidence, justify the departure.
  • Cross-check clarity: The decision legitimizes the standard cross-check practice—compute the implied multiplier, then analyze its reasonableness—rejecting “reverse engineering” rhetoric when the factor analysis is robust.
  • Fees-on-fees in Oklahoma common-fund cases: The opinion reinforces that reasonable fee-defense efforts can be included, even when they include aggressive appellate steps, if a trial court makes an evidence-backed reasonableness call under Burk.
  • Recordkeeping realism: Oklahoma does not impose an automatic bar for reconstructed time entries; adequacy of the record and credibility assessments remain central.
  • Litigation strategy for objectors and counsel: Objectors must preserve substantive reasonableness arguments at the earliest feasible appellate stage; counsel seeking deviations should build a record explicitly tied to the statutory factors (risk, certification difficulty, results, market rates, comparators).

4. Complex Concepts Simplified

  • Common fund: A pool of money (here, $52 million) created by settlement/judgment for the benefit of the class; fees are taken from the fund, reducing class distributions.
  • Percentage-of-the-fund fee: Counsel receives a set percentage of the common fund (here, 33.33%).
  • Lodestar: Hours reasonably worked × reasonable hourly rate = “base” fee.
  • Multiplier (enhancement): A factor applied to the lodestar (e.g., 2.15×) to reflect risk, exceptional results, complexity, and other statutory considerations.
  • Lodestar cross-check: A sanity-check against windfall: compare the percentage fee to the lodestar to see what multiplier is implied.
  • Fees-on-fees: Time lawyers spend seeking and defending their fee request. Oklahoma permits it if reasonable (Burk), though other jurisdictions sometimes restrict it in common-fund cases.
  • Abuse of discretion / clear error: Highly deferential appellate standards; even if an appellate court might have chosen a different number, it will affirm unless the trial court’s choice is outside permissible bounds or factfinding is plainly wrong.
  • Forfeiture: Losing the ability to press an argument by failing to raise it when you should have; forfeited issues generally cannot be revived on remand.

5. Conclusion

The Tenth Circuit’s decision confirms a pragmatic, discretion-respecting understanding of Oklahoma class-action fee law after Strack v. Continental Resources, Inc.: the statutory touchstone is reasonableness, not mechanical adherence to averages. A fee above 30% (and a multiplier above 1.5) can be upheld when the district court conducts a genuine, evidence-based factor analysis and performs a proper cross-check. The opinion also strengthens two practical points for future litigation: reconstructed time records can suffice under Oklahoma law, and “fees-on-fees” may be compensable when reasonably incurred—leaving trial courts, not objectors’ proposed ceilings, as the primary arbiters of fee reasonableness.