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Category: Fee Award

NALFA: The Four Hourly Rate Factors

December 6, 2017

Hourly rates are the engine that drives attorney fees.  Hour rates are the most important single factor in determining attorney fee awards.  There are several factors that determine hourly rates.  NALFA has identified four hourly rate factors that have significant impact on prevailing market hourly rates.  At NALFA, these four factors are known as the primary variables and should be a part of any hourly rate survey.  We've ranked these hourly rates factors in order of importance:

Geography / Jurisdiction:  This is the most important of the factor in determining hourly rates.  Where an attorney practices matters the most.  Simply put, all things being equal, hourly rates in Manhattan are not the same as hourly rates in Oklahoma City.

Years in Practice / Position Title:  This is the second most important factor in determining hourly rates.  The more senior or experienced the attorney, the higher the hourly rate.  Simply put, all things being equal, hourly rates for partners are not the same as hourly rates for associates.

Practice Area / Complexity of Matter: 
Often overlooked and subtle, the nature of the underlying matters in determining hourly rates.  Hourly rates for more routine matters will not be the same as more complex areas of law.  Simply put, all things being equal, attorneys who practice in insurance defense or workers comp will charge different rates than attorneys who practice in antitrust litigation or white collar crimes.

Law Firm Size:  This is the least important of the factors, but still somewhat relevant.  Simply put, all things being equal, solo practitioners may have different rates than attorneys at very large law firms.

Ninth Circuit Backs Attorney Fees in ERISA Appellate Work

November 28, 2017

A recent Law 360 story by Adam Lidgett, “9th Circ. Backs Appellate Attys’ Fees for Benefit Plan,reports that a Ninth Circuit panel reversed a lower court’s denial of appellate attorneys' fees for an employee benefit plan in its dispute with Sun Life Assurance Co. of Canada Inc., saying the district court failed to take into account the whole course of litigation in analyzing the fee request. 

The panel reversed and remanded the denial of the fee request from the Group Disability Benefits Plan for California-based Gynecologic Oncology Associates Partners LLC.  The plan sought attorneys' fees and costs it incurred defending an earlier award of attorneys' fees in an Employee Retirement Income Security Act (ERISA) case filed against the plan and Sun Life.

The Ninth Circuit said the district court has to take into account the entire course of litigation and that it was clear the plan is entitled to the appellate attorneys' fees after weighing five factors outlined in the case Hummell v. S.E. Rykoff & Co. in light of Sun Life’s conduct.  Those factors included Sun Life's denial of a claim for disability benefits from a cancer surgeon with Gynecologic Oncology Associates Partners, the move that kicked off the initial lawsuit.

The appellate judges said the plan was forced into litigation after Sun Life wrongfully denied Dr. John Paul Micha’s claims and that Sun Life doesn’t dispute it can pay the fee award.  The panel remanded the issue to the district court to calculate reasonable fees.

“A party like Sun Life should not be able to appeal from a litigation fee award, even on an issue justifying appellate review, and thereby impose significant costs on the appellee in defending the fee award, while taking comfort in the knowledge that any potential appellate fee award against it will be judged solely on the basis of its appellate arguments on the fee issue,” the published decision said.

The case dates back to 2009 when Micha filed the suit after he was denied disability benefits by Sun Life.  The benefits of the plan were insured under a policy purchased from Sun Life, the plan has said.  After Sun Life settled Micha’s suit, the plan said it moved for attorneys' fees, and the district court agreed, awarding more than $38,000.  Sun Life appealed that award to the Ninth Circuit, but the appellate court affirmed the plan's win, prompting Sun Life to file a petition for a writ of certiorari in the U.S. Supreme Court, court papers show.

The Supreme Court denied the petition, however, and the plan sought an award for attorneys' fees and costs it incurred on appeal, according to court documents.  However, it first filed with the Ninth Circuit to transfer consideration of appellate attorneys' fees to the district court, the plan has said.  But when the issue went back to the lower court, the court denied the plan’s request for attorneys' fees incurred in defending the earlier award, the plan said.

The case is John Micha v. Sun Life Assurance of Canada et al., case number 16-55053, in the U.S. Court of Appeals for the Ninth Circuit.

Attorneys Get Fraction of Fee Request in FACTA Settlement

November 27, 2017

A recent Law 360 story by Melissa Daniels, “UCLA Shoppers’ Attys Get Fraction of Fees Ask in FACTA Deal,” reports that a California judge said he’d award plaintiffs’ attorneys only about 6 percent of their requested fees for representing consumers in the settlement of a Fair and Accurate Credit Transaction Act class action against UCLA, after noting in his tentative ruling that “when lawyers accomplish little, they deserve little.”
 
Los Angeles County Superior Court Judge John Shepard Wiley Jr. had already granted preliminary approval to a settlement over receipts printed at the University of California, Los Angeles with a projected total value of nearly $1.2 million.  But after an underwhelming number of claims yielded about $20,000 in payouts, the parties negotiated to have about $830,000 of unclaimed funds be designated as cy pres awards to support privacy- and finance-related programs at the university.

After reviewing this outcome, Judge Wiley issued a tentative ruling on that took issue with the fact that the funds were staying within the realm of the university instead of benefiting any class members.  “This isn’t even a revisionary settlement, the money doesn’t revert,” he said. “It just stays.”

As a result of the perceived puffed-up value, Judge Wiley calculated the attorneys’ fees off of a $40,000 settlement value, awarding $13,333 instead of the $227,000 that was requested.  Judge Wiley’s tentative ruling, which he said he would adopt after making a few grammatical tweaks, also cut named plaintiff Cindy Fernandez’ class representative award from $5,000 to $500.  A final report will be due next year.

The suit, filed in March, said UCLA accepted credit and debit cards from at least 1,000 putative class members who made purchases at its establishments in Los Angeles, but that the machines at its points of sale gave receipts that showed an unlawful amount of card number digits — including some receipts that showed the first six and last four numbers of shoppers’ cards and others that showed the first and last four digits.

UCLA said the misprints stemmed from software vendors that the university reasonably relied upon to comply with applicable law — and it also cited its possible immunity as a public institution. Yet the school agreed to settlement without admitting liability to avoid the burdens of litigation, according to settlement documents.

The motion for final approval said the parties determined four programs to benefit from the nearly $830,000 in unclaimed funds: programs for privacy awareness and financial wellness, counselors for students in economic crises, funding for academic courses on privacy and funding and a security audit for the ASUCLA, the student-controlled, nonprofit organization that provides retail and student union services.

Daniel Gaines of Gaines & Gaines APLC, who represents the plaintiffs, defended the “important, worthy goals” of the cy pres programs and said that while he understood Judge Wiley’s point, he still sees the value of the deal at approximately $1.2 million.  “When you’re talking about the university, it’s a little different than when you’re talking about a private corporation,” Gaines said. “This money that’s being spent on projects, it’s projects that otherwise wouldn’t have been expended on.”

The case is Cindy Fernandez v. The Regents of the University of California et al., case number BC656256, in the Superior Court of the State of California for the County of Los Angeles.

Class Counsel Awarded $2M in Fees in Frito-Lay Settlement

November 22, 2017

A recent Law 360 story by Joyce Hanson, “Frito-Lay to Pay $2M in Fees in ‘All Natural’ Suit Deal,” reports that a New York federal judge approved the settlement of a class suit accusing Frito-Lay of deceptively labeling food products as being “made with all natural ingredients” when they are actually made with ingredients containing genetically modified organisms, awarding about $2 million in attorneys’ fees and expenses to class counsel.

U.S. District Judge Roslynn R. Mauskopf finally signed off on the proposed settlement agreed to in November 2015 by lead plaintiff Julie Gengo and Frito-Lay North America Inc., which offers no award of damages to the class but does provide the primary relief sought in the litigation — namely, an assurance that products such as Tostitos and SunChips will not be labeled or advertised as “natural” unless those claims on any products containing GMOs are expressly authorized by the U.S. Food and Drug Administration or state or federal legislation.

“The complexity, expense and likely duration of the litigation favor settlement, which provides substantial benefits on a much shorter time frame than otherwise possible on behalf of the class,” Judge Mauskopf said.  “The support of class counsel, who are highly skilled in class action litigation such as this, and the plaintiffs, who have participated in this litigation and evaluated the settlement, also favor final approval.”

Under the terms of the final order and settlement agreement, Frito-Lay does not admit the validity of the claims or any wrongdoing or liability, the judge said.  Frito-Lay also continues to deny that its labeling of the challenged products is false, deceptive or misleading to consumers or violates any legal requirement.  However, Frito-Lay has already removed the “made with all natural ingredients” claim from its products, and the company has agreed not to label the products as “natural” as long as they continue to include GMO ingredients, according to a Nov. 10, 2015, class counsel memo.  The settlement was achieved with the assistance of retired U.S. District Judge Richard J. Holwell after mediation sessions over a period of 10 months, the memo said.

The judge approved class counsel’s motion for attorneys' fees in the amount of $1.9 million and for reimbursement of expenses of up to $200,000.  She also approved $5,000 awards to class representatives Gengo, Chris Shake and Valarie Zuro, and a $2,500 award to class representative Deborah Lawson.

“Class counsel achieved a favorable result for the class and created a benefit with a substantial value to the class by obtaining Frito-Lay's agreement to modify the labeling policies and practices challenged in this lawsuit,” Judge Mauskopf said in making the award of attorneys’ fees and expenses.

The case is Julie Gengo v. Frito Lay North America Inc., case number 1:12-cv-00854, in the U.S. District Court for the Eastern District of New York.  The multidistrict case is In re: Frito-Lay North America Inc. All Natural Litigation, case number 1:12-md-02413, in the U.S. District Court for the Eastern District of New York.

Greenberg Traurig Wins $2M Fee Award in U.S. Court of Claims

November 20, 2017

A recent Law.com story by C. Ryan Barber, “Greenberg Traurig Wins $2M Fee Award in Suit Against U.S. Government,” reports that a federal claims court judge ordered the government to pay $2 million in legal fees to Greenberg Traurig for its work representing a Florida real estate developer that prevailed in a long-running case over the denial of a permit to fill in wetlands.  After two rounds through U.S. Court of Federal Claims, each followed by an appeal to the U.S. Court of Appeals for the Federal Circuit, the company, Lost Tree Village Corp., prevailed in its challenge when the U.S. Supreme Court declined in June to hear the case.

The U.S. Department of Justice had asked the high court to review a 2015 decision that said the U.S. government’s denial of the fill permit amounted to an uncompensated “taking” of Lost Tree’s property.  Charles Lettow, a judge on the U.S. Court of Federal Claims, ordered the government to pay $4.2 million in damages, plus $3.5 million in interest.  Lost Tree Village Corp.’s lawyers at Greenberg Traurig, led by Washington partner Jerry Stouck, had argued the government owed more.

Stouck this summer went to the Federal Claims court seeking about $2 million in attorney fees from the government, along with $100,000 in other fees and expenses incurred by Lost Tree.  Stouck, chairman of the firm’s regulatory and administrative law practice, identified Lost Tree’s legal fees in remarkable detail, noting a period in which he and two other principal timekeepers at Greenberg Traurig had given discounts of between 5 and 15 percent of the standard hourly rates.  Stouck identified his standard billing rate, for 2017, at $810 an hour.  Greenberg Traurig’s court filings reveal standard billing rates for Stouck and other Greenberg lawyers from 2007 to now.

For the first appeal to the Federal Circuit, Stouck said, the firm and Lost Tree agreed on a fixed fee of $67,00, plus expenses, with an additional $300,000 payable only if Greenberg Traurig prevailed. (It did so.)

The $300,000 success fee, under the terms of the agreement, would be “recoverable from the government as part of the reasonable attorneys’ fees due to Lost Tree.”  Stouck told the court that Lost Tree “has achieved complete success.”  He added: “Perhaps more importantly, while this case was hard-fought and long-fought, Lost Tree has prevailed completely on what both parties and the court recognized from the outset was the principle issue to be decided—the ‘relevant parcel’ issue.”

The Justice Department, arguing that Greenberg Traurig’s billing “reflects excessive rates for attorney and paralegal work,” said Lost Tree should be awarded at most $1,078,121 in fees.  In a court filing, the Justice Department said Greenberg Traurig billed for “work done on matters unrelated to this case and irrelevant to the merits, work where the hours devoted to tasks were far beyond reasonable or duplicated by multiple attorneys, and work where very senior personnel were performing tasks typically done by more-junior personnel.”

From the government’s filing: “Most egregiously, plaintiff seeks reimbursement for a $300,000 bonus not-yet paid that is not based on work done for the case, but instead because they were victorious on appeal.  The United States has not waived its sovereign immunity to reimburse ‘success fees’ sought in addition to fees for the hours actually devoted to work on the case.

“I was actually surprised that the government had disputed our fees so aggressively because, as you can see from the opinion, my client has paid all of the fees,” Stouck said.  “And I think that is a very substantial proof of the reasonableness of it.”

In a court filing, Stouck defended the $300,000 success fee as not just reasonable but a “greatly reduced” fee for the appeal.  “This is not a situation where Greenberg is seeking an ‘enhancement’ to its hourly rates,” he wrote in a court filing.  “Lost Tree and Greenberg are simply asking the court to enforce their reasonable, arm’s length agreement.  In the context of this case, the alternative fee arrangement represents Greenberg’s commercially-available rate.”  The judge did not award the success fee but did award $91,000 in fees that were incurred beyond the fixed expense of $67,500.