A recent Law 360 story by Elizabeth Daley, “Insurer Owes Sugar Co. $3.5M After Fee Cut in Emissions Suit”, reports that United States Sugar Corp. cannot recoup from its insurer all it spent in a nearly $10 million battle against a proposed class action alleging toxic emissions from pre-harvest sugarcane burns, a Florida federal judge ruled, finding costs excessive.  In his order, U.S. District Judge Robert N. Scola Jr. wrote that Commerce and Industry Insurance Co. would only be responsible for paying just over $6.5 million in connection with the underlying case, resulting "in roughly a 24% overall reduction of US Sugar's requested attorneys' fees and costs."  Because the insurer had already paid about $2.1 million and the sugar company was subject to a $1 million self-insured retention, the insurer ended up owing U.S. Sugar nearly $3.5 million, the judge said.

The dispute between U.S. Sugar and Commerce and Industry stemmed from an underlying lawsuit that was voluntarily dismissed in 2022.  The complaint, filed in 2019, accused U.S. Sugar and other leading sugar producers of harming nearby Florida properties through the practice of pre-harvest sugarcane burns, which the lawsuits alleged emitted toxic "black snow" in the Glades region.  The plaintiffs alleged the black snow, which sent plumes of smoke into the air and deposited ash on cars, homes and yards, harmed public health and local property values.

U.S. Sugar told the court that the underlying complaint was amended three times and the company spent millions of dollars defending itself.  The plaintiffs eventually dropped the litigation.  The insurer refused to defend U.S. Sugar, but was ultimately found responsible, according to court documents.  In his order, Judge Scola found that the costs of defending the lawsuit were so steep that he agreed with the insurer that they were beyond the reasonable costs that Florida law dictates must be reimbursed under the circumstances.

While opposing the insurer's request for a 50% reduction of the costs and fees, Judge Scola did agree that the work by some of the six law firms U.S. Sugar employed — Gunster, Mayer Brown, Holland & Knight, Litchfield Cavo, Haliczer Pettis & Schwamm and Clare Locke — was at times duplicative.  He specifically cited Gunster and Mayer Brown, writing "both firms [took] overlapping roles on the review and investigation of the pleadings and on legal briefing relating to the pleadings."

As a result, the judge cut Gunster's fees by 20% and Mayer Brown's by 30%. He also challenged some costs related to expert witnesses, leading him to employ the overall 24% reduction to U.S. Sugar's costs.  However, the judge declined to challenge the pay rates for three Mayer Brown attorneys despite the insurer calling their hourly rates of $1,058, $995 and $932 excessive.

Judge Scola explained that though the underlying case did not proceed to discovery, it lasted for over two and a half years.  While it did not involve novel questions, there were many legal filings and the case was more challenging than many because it involved both personal injury and environmental harm, he said.  The case required specialty environmental attorneys with "an above-average level of skill," Judge Scola wrote.  As such, he wrote that the attorney fees were high as might be expected for a complex case.

Additionally, the Miami-based judge added that "the South Florida legal market has changed drastically in the last several years.  Miami in particular has developed into a national legal market.  That top-end firms will be able to charge national hourly rates in South Florida, now, is an inevitable consequence of that development."