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Category: Fee Jurisprudence

Compare & Prove Hourly Rates with NALFA Survey

July 20, 2021

Every year, NALFA conducts an hourly rate survey of civil litigation in the U.S.  NALFA has released the results from its 2020 Litigation Hourly Rate Survey.  The survey results, published in The 2020 Litigation Hourly Rate Survey & Report, shows hourly rate data on the very factors that correlate to hourly rates in litigation:

  • Geography / Location / Jurisdiction
  • Years of Litigation Experience / Seniority
  • Practice Area / Complexity of Case
  • Law Firm / Law Office Size

This empirical survey and report provides macro and micro data of current hourly rate ranges for both defense and plaintiffs’ litigators, at various litigation experience levels, from large law firms to solo shops, in routine and complex litigation, and in the nation’s largest legal markets and beyond.  This is the nation’s largest and most comprehensive survey or study on hourly rates.  This data-intensive survey contains hundreds of data sets and thousands of data points covering dozens of relevant hourly rate variables.  The survey was designed to aid litigators in comparing rates within a litigation peer group and proving rates in court and ADR.

The 2020 Litigation Hourly Rate Survey & Report is divided into two parts, a free public portion and a private portion.  The public portion contains only the survey totals.  The data-rich private portion has the complete survey results including the raw data responses with percentages.  The private portion is free to members of our network (i.e. members, faculty, and fellows) and the 2020 litigation survey respondents.  The private portion is available for purchase to others.     

This 2020 Litigation Hourly Rate Survey & Report is now available for purchase.  For more information on this, email NALFA Executive Director, Terry Jesse at terry@thenalfa.org or call us at (312) 907-7275.

Attorneys’ Invoices in Prior Case May Be Admitted to Support Testimony

July 13, 2021

A recent Metropolitan News story, “Attorneys’ Invoice in Prior Case May Be Admitted to Support Testimony”, reports that a landowner who was sued by a man induced by a real estate agent into believing he had a contractual right to purchase her property when no contract had been formed was given a second chance yesterday by the Court of Appeal to win recompense from the realty company in a “tort of another” case for the attorney fees she incurred in the prior action.

The opinion was authored by Justice William Dato of the Fourth District’s Div. One. It reverses a judgment to the extent that San Diego County Superior Court Judge Ronald L. Styn denied attorney fees to plaintiff Hue Thi Dong Mai.

Styn did so, with expressed reluctance, in light of the Oct. 19, 2018 decision by the Fourth District’s Div. Three in Copenbarger v. Morris Cerullo World Evangelism, Inc. He read the case as barring Mai’s introduction of invoices for attorneys fees she expended in the breach-of-contract action against her, as inadmissible hearsay, and precluding him from taking judicial notice of what work was done in the prior case, over which he had also presided.

Mai was sued by John Fike who had been told by realtor Victoria Robinson of Keller Williams that a deal for the purchase of Mai’s property had been reach, when it hadn’t. After telling Fike that an accord had been reached, Robinson—desiring to obtain a commission on a sale for more than $1 million—then sought to persuade Mai to sell at the price she had set, but she declined.

After Fike dropped his suit, Mai sued Robinson and the company that owns Keller Williams under the “tort of another” doctrine which, Dato noted, “allows for the recovery of attorney’s fees as damages when a plaintiff is forced into litigation with a third party due to the tortious conduct of the defendant.” She obtained a judgment for $50,000 for emotional distress but nothing for the attorney fees she had expended in the action brought by Fisk.

Once Styn realized that attorney fees were being sought as damages subject to proof at trial, and not as costs which could be reckoned by reference to his own assessment of the value of services, he expressed a powerless to deviate from what he saw as constraints set down by Copenbarger and denied an award of those fees. Dato said he would read Copenbarger narrowly to avoid a conflict with other decisions.

He said of Copenbarger: “We are… of the opinion that its commentary on the inadmissibility of the invoices would only apply to cases where plaintiffs attempt to read the detailed entries on the bills during their testimony to prove the specific repairs made or services rendered—and not where the invoices are offered for the more limited and appropriate purpose of corroborating testimony that they actually paid certain amounts and/or to make a prima facie showing that the charges were reasonably incurred.

“As pertinent to this case, Mai sought to introduce redacted copies of the attorney invoices only to support her testimony that she paid the billed amounts and as some evidence that the amounts were reasonable….The trial court erred in broadly reading Copenbarger to preclude both Mai’s testimony and receipt of the invoices for these limited and appropriate purposes.  This evidence would have satisfied Mai’s prima facie burden to establish how much she paid for legal services and the reasonableness of that amount.”

Dato went on to say that Copenbarger “strongly implies—though it does not hold” that judicial notice of the content of the file in a previous action would be improper. He said: “The sounder and long-established rule is that materials filed by attorneys on behalf of litigants can be judicially noticed and provide evidence to support an award of attorney’s fees.  As relevant to this case, the materials filed on Mai’s behalf by her attorneys in the Fike action were properly subject to judicial notice and provide some evidence of the work performed defending that case.” A remand was ordered for the limited purpose of setting attorney fees.

SCOTUS Won’t Hear Dispute Over Patent Attorney Fee Awards

June 14, 2021

A recent Law 360 story by Tiffany Hu, “Justice Won’t Hear Dispute Over Atty Fees in Patent Cases,” reports that the U.S. Supreme Court declined to hear a question on courts' allegedly "inconsistent and contradictory" discretion over attorney fees in a patent case involving lost luggage technology.

The high court denied Roadie Inc.'s petition to take up its appeal of a Federal Circuit ruling that shot down its request for attorney fees, despite the company's arguments that the case should have been deemed exceptional because of procedural missteps by an attorney for rival Baggage Airline Guest Services Inc. The Federal Circuit affirmed the invalidation of BAGS' patent, which BAGS alleged Roadie had infringed.

Roadie had argued that it was "forced to defend a case that should never [have] been brought" and that the lower courts should have considered the weakness of BAGS' case — and Roadie's "strong showing of noninfringement" — and awarded Roadie fees for fending off the suit.

"Since 2014, judicial 'discretion' has been inconsistent and contradictory in a way that frustrates the goal of [the Patent Act] which is to improve the efficiency of the judiciary by discouraging the filing of bogus lawsuits," Roadie said in its petition.

According to Roadie, the district court's decision not to consider the issue of noninfringement went against the high court's 2014 ruling in Octane Fitness LLC v. ICON Health & Fitness Inc. , which made it easier for prevailing parties to obtain fees, according to the petition.

Around that same time, the high court also ruled in Highmark Inc. v. Allcare Health Management System Inc. that because determining whether a case is "exceptional" is up to the district court's discretion, that decision can be reviewed on appeal for abuse of discretion, Roadie argued.

BAGS filed its opposition last month, contending that the Federal Circuit's decision to defer to the lower court's "reasoned analysis" did not meet the statutory requirements for certiorari. Roadie's arguments before the Supreme Court did not "include anything persuasive not already considered by the district court and the Federal Circuit," it added.

Edward A. Pennington of Smith Gambrell & Russell LLP, an attorney for Roadie, told Law360 in an email Monday that "every entity that tries to bring an important matter to the Supreme Court is disappointed when the court does not take the case," but that his client realizes few petitions are granted "no matter how important the fee reversal issue is."

"Fee reversal ... should be an important deterrent against ill-conceived patent suits, but as long as district courts have loosely defined factors to consider, we will continue to see inconsistent decisions," Pennington said.

The dispute dates to 2017, when BAGS accused Roadie, which pairs customers who need items shipped to drivers already headed in the correct direction, of developing an app that infringes the patent.

Roadie had asked a Delaware federal judge for judgment on the pleadings based on invalidity and noninfringement simultaneously. The court granted the motion on invalidity, with the Federal Circuit later affirming the decision, finding BAGS' patent was directed to a patent-ineligible abstract idea of "coordinating and monitoring baggage delivery."

The district court declined to consider Roadie's noninfringement arguments, which were fully briefed, since it found the patent invalid. Had it factored the noninfringement issue into its exceptionality finding, Roadie argued, that would have supported the argument that the case was meritless and that Roadie deserved fees.

The district court denied Roadie's bid for fees, however, saying there was no evidence of nefarious intent despite the missteps by BAGS, which the district court chalked up to inexperience and mistakes. The Federal Circuit affirmed the ruling in November.

Eleventh Circuit Upholds Fee Award in Chinese Drywall MDL

June 10, 2021

A recent Law 360 story by Carolina Bolado, “11th Circ. Upholds Fee Award in Chinese Drywall MDL,” reports that the Eleventh Circuit ruled that court-appointed class counsel in the defective Chinese drywall multidistrict litigation could receive 45% of the total fees paid to attorneys who negotiated settlements for 497 Florida plaintiffs because their work on the common case helped lead to the individual recoveries.  The appeals court said U.S. District Judge Marcia G. Cooke did not abuse her discretion when she awarded class counsel $5.8 million of the more than $40 million paid by Taishan Gypsum Co. Ltd. to end claims over shoddy drywall imported from China.

The class counsel includes firms Colson Hicks Eidson, Lieff Cabraser Heimann & Bernstein LLP, Morgan & Morgan, Herman Herman & Katz LLC and Seeger Weiss LLP.  The Eleventh Circuit said that although the attorneys for the 497 plaintiffs had worked hard to get the deal, their work "did not exist in a vacuum."

"They benefited from the decade of foundational work that class counsel exerted in this groundbreaking MDL, which involved evasive defendants in China, complex jurisdictional challenges requiring two trips to the Fifth Circuit, decertification attempts and liability determinations," the appeals court said.  "That class counsel has otherwise been compensated for this work does not prevent them from continuing to reap the rewards of their efforts."  The 497 plaintiffs were part of 1,734 Florida cases remanded in 2018 from the MDL in Louisiana to Judge Cooke in the Southern District of Florida for further proceedings.

Following the settlement with the 497 plaintiffs, class counsel said that much of their foundational work was used to secure the deals, entitling them to 20% of the total settlement.  After a global settlement was approved in January 2020 between Taishan and the remaining class members, the class counsel amended their award request to 60% of the attorney fees paid out to the individual plaintiffs, according to the opinion.  In May 2020, Judge Cooke awarded them a 45% cut.

The counsel for the individual plaintiffs appealed the decision, arguing that common benefit fees are only appropriate when there is a common fund from which to award them.  In this case, there is no common fund or judicial supervision of a fund, they said.  They also argued that class counsel have already been highly compensated for their common benefit work by the MDL court.

But the Eleventh Circuit said that particularly in complex litigation, courts have broad managerial power and discretion to award fees.  "The district court had control over the funds pursuant to the agreement of the parties to litigate common benefit fees in the SDFL and the actions taken by the court after the settlement agreement was first filed," the appeals court said.  "Awarding a portion of these fees to class counsel was therefore within the district court's power."  The appeals court added that preventing appointed counsel from recovering fees when their work leads to settlements down the road would make it more difficult for courts to find competent lawyers to take on that work.

Jimmy Faircloth, who represents the attorneys who worked on the individual settlements, told Law360 the ruling conflicts with Eleventh Circuit precedent by allowing contractual attorney fees to be used as a fund for purposes of the common benefit doctrine.  "[The ruling] allows MDL authority to reach even deeper into the jurisdiction of a transferor court following a remand," Faircloth said.  "This creates a slippery slope with negative consequences for the class action device."

Patrick Montoya, who represents the class counsel, said he was pleased the Eleventh Circuit affirmed Judge Cooke's "well-founded opinion recognizing class counsel's efforts in this decade-long, hard-fought case."  "The settlement obtained by class counsel was an unprecedented result against Chinese companies and the first of its kind in the United States," Montoya said.  "Judge Cooke and the Eleventh Circuit prevented a group of splinter lawyers from doing an end-around and unfairly benefitting from the class counsel's monumental efforts and the excellent results obtained for class members by class counsel."

Ninth Circuit Strikes Down $7M Fee Award in ConAgra Class Settlement

June 2, 2021

A recent Law 360 story by Emily Field, “9th Circ. Strikes Down $7M Atty Fees in ConAgra Label Deal,” reports that the Ninth Circuit overturned a judge's approval of a class action settlement with ConAgra Food Inc. over its labeling on oil products, saying the parties crammed into the deal "a squadron of red flags" including attorney fees of nearly $7 million that are much larger than what consumers were awarded.  The panel in a published opinion said the agreement includes a number of questionable provisions and "reeks of collusion," particularly the attorney fee award of $6.85 million that is seven times higher than what class members received.

ConAgra and class counsel contended the deal could be worth more than $100 million, but ultimately, ConAgra paid out less than $8 million, with just $1 million going to the class.  Large counsel fees comparative to the payout for class members raises the possibility that counsel colluded with the defendant to lower class compensation in exchange for a larger fee, the panel said.  A defendant would go along with this kind of conspiracy because it only cares about how much it's paying in total, not how it's divided up, they added.

The panel said district courts must scrutinize attorney fee award arrangements when deciding whether a class action settlement is fair, following revisions to the Federal Rules for Civil Procedure that introduced the requirement in 2018.  Specifically, that requirement also applies to settlements that were reached after a class was certified, the panel held for the first time.  "[A] post-class certification settlement only ensures that the parties litigated aggressively to arrive at an adequate total fund size; it does not, however, address the inherent incentives that tempt class counsel to elevate his or her own interest over those of the class members," the panel said.

The panel's decision reverses the 2019 approval of the deal and sends the case back to California federal court.  In the suit, the buyers alleged ConAgra mislabeled its Wesson oil products as "100% natural" even though they contain genetically modified ingredients.

The deal also included a stipulation that ConAgra not advertise the Wesson brand of essential oils as "100% natural" anymore, which was supposedly worth tens of millions of dollars but now appears worthless since ConAgra no longer owns the brand, the panel said.  "That is like George Lucas promising no more mediocre and schlocky Star Wars sequels shortly after selling the franchise to Disney.  Such a promise would be illusory," the panel wrote in their opinion.

Objector and University of Chicago law professor M. Todd Henderson brought the appeal last year, arguing the lower court did not take into account the deal's value to the class when it granted the fees.  The panel also found other red flags in the settlement, such as a "clear sailing arrangement" under which ConAgra agreed not to challenge the class counsel fees.  "A clear sailing provision signals the potential that a defendant agreed to pay class counsel excessive fees in exchange for counsel accepting a lower amount for the class members," the panel said.