A recent Law 360 story by Bill Wichert, “’Vague’ Fee Entries Targeted in Boston Scientific FCA Suit,” reports that a New Jersey federal judge said whistleblowers’ lawyers should get about $2 million less than the roughly $7.6 million in attorney fees and costs they want from Boston Scientific after settling a False Claims Act suit, citing vague billing entries for hundreds of hours spent “reviewing documents.” In a report and recommendation made available, U.S. Magistrate Judge Steven C. Mannion called for awarding about $5.5 million in fees and costs — most of which would go to Susman Godfrey LLP — saying the firm should be paid for slightly fewer attorney hours that it billed due to such “vague and excessive entries.”
Judge Mannion found that “Susman Godfrey generally spent its time on reasonable activities, and generally spent a reasonable amount of time on each activity,” but said he is “particularly concerned by the vagueness of certain entries.” For instance, the judge cited “172 entries with the exact description ‘Reviewing documents’ and no more, amounting to 918.5 hours of time.” “Although such vague billing is occasionally acceptable for junior associates performing initial document review, such descriptions are nowhere near detailed enough for the court to review the reasonableness of the hours for partners and senior associates,” Judge Mannion said.
The judge concluded it is “not reasonable” for four particular senior attorneys at Susman Godfrey “to be performing the type of initial document review that does not warrant further description, but these four attorneys alone account for 140 such entries —totaling 788.7 hours and not including the numerous equally vague variations such as ‘reviewing discovery.’” Instead of detailing “all of the various vague and excessive entries” among the roughly 3,500 entries, Judge Mannion proposed cutting the 8,105.7 hours requested for Susman Godfrey attorneys by 850 hours, saying that reduction is “a good analogue of the size of the problem.”
Judge Mannion also suggested reducing the hourly rate for work by Susman Godfrey paralegals. The firm requested a “blended rate” of $618 per hour for work by both attorneys and paralegals. The judge said similar rates have been approved in recent years in New Jersey federal court and that $618 an hour is a reasonable rate for the attorneys’ work but not for the paralegals'. Instead, the judge recommended setting the rate for the paralegals’ work at $150 an hour, which was the rate billed for work performed by a local associate from a different firm.
Susman Godfrey and Grant W. McGuire of McManimon Scotland & Baumann LLC submitted the request in June for about $6.7 million in attorney fees and roughly $908,000 in costs, after reaching a $2.5 million settlement with Boston Scientific on behalf of former company employees Wendy A. Bahnsen and Caroline H. Fuentes. The case, which was originally filed in 2011, dealt with allegations that the medical device maker illegally paid doctors to promote off-label uses of its Precision Plus spinal cord stimulation system and of billing Medicare and Medicaid for such uses. Bahnsen and Fuentes originally sought more than $70 million in damages, court documents state.
After reducing the hours for Susman Godfrey attorneys and the hourly rate for paralegals, Judge Mannion calculated a fee award of about $5.1 million. But the judge then suggested reducing the amount even further after accepting Boston Scientific’s argument that the fees should be cut since the settlement was much less than what the ex-workers initially sought, according to his opinion.
“Fees in excess of $5M may have been reasonable had relator’s attorneys achieved a result anywhere near the original demand in this suit of roughly $70M. But, in light of that original demand, the court cannot call the $2.5M actually obtained exceptional,” the judge said. “The fact that Boston Scientific has previously argued that it should not have had to pay that much is unavailing.” As a result, Judge Mannion proposed cutting the fee award to roughly $4.6 million. He did not disturb the proposed costs of about $908,000.