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Law Firms Dispute Over Attorney Fees Ends After Years of Litigation

July 8, 2020 | Posted in : Contingency Fees / POF, Fee Dispute, Fee Dispute Litigation / ADR, Fee Entitlement / Recoverability, Hourly Rates

A recent Daily Business Review story by Michael Mora, “Mintz Truppman Loses 70% of Fees Sought in Litigation Against Cozen O’Connor” reports that it’s bad news for Mintz Truppman in a case that pitted two law firms against each other over attorney fees, and played out over years in several Florida courtrooms.  Timothy H. Crutchfield, a partner and representative for Mintz Truppman in North Miami, sought about $828,000 in attorney fees from the opposing parties, Lexington Insurance Co. and Cozen O’Connor.  But Florida’s Third District Court of Appeal affirmed the federal district court ruling that found Mintz Truppman was only entitled to about 29 percent of that amount, or about $240,000.

According to Charles C. Kline, a partner for Cozen O’Connor in Miami—representative for that firm, Lexington Insurance and Cozen O’Conner West Palm Beach member John David Dickenson—said the most critical takeaway for lawyers is to respect the court’s jurisdiction.  “You need to present all the arguments you have to get the right judgment,” Kline said.  “Don’t sit on your rights.  Don’t fail to object to evidence.  Don’t think you can go to another court to redo what the first court did, because that is just contrary to our principles of collateral estoppel.”

The Third DCA stated damages for the additional fees sought by Mintz Truppman for representing Daphne Query “have already been adjudicated by the federal court.” It granted Cozen, which has several offices in the U.S., including Washington, D.C., and Dallas, Texas, and Lexington’s petitions for prohibition, but dismissed their petitions for certiorari as moot.

The case stems from a broken pipe dispute that caused substantial water damage to Query’s Miami-Dade home in 2014.  Lexington insured the home, according to the Third DCA opinion.  Two years later, Query’s property damage claim was settled at mediation.  The parties also agreed that Query was entitled to attorney fees but were unable to agree on the amount.

When mediation to resolve the fee dispute failed, Query filed a motion for attorney fees in federal court, seeking a contingency risk multiplier of two based upon the total hours incurred by Mintz Tupperman and its co-counsel and the hourly rate for each of the four attorneys who worked on the matter.  That number came to just over $828,000.  Lexington countered that the amount owed should be no more than $70,000 to $85,000.

A federal magistrate judge in February 2017 determined Query was entitled to total lodestar attorney fees of nearly $240,000 after reviewing “all relevant submissions,” according to the Third DCA’s opinion.  Query failed to object and the federal district court judge accepted the magistrate judge’s report and recommendation.  One month later, the federal district court entered final judgment.

Meanwhile, in November 2016, Mintz filed an action in the Miami-Dade Circuit Court seeking a determination under state law on the amount of fees to which it was entitled.  The Third DCA eventually ruled that the lower court lacked subject matter jurisdiction and granted Cozen and Lexington’s petitions seeking prohibition.  Crutchfield, the representative for Mintz Truppman, expressed frustration with the Third DCA for focusing on “one issue,” namely attorney fees, instead of the underlying cause of the action.  Crutchfield also characterized the Third DCA’s language as “concerning.”

“It seems to imply that the court can petition for prohibition.  It looked at what was believed to be behind the complaint instead of looking at the actual allegations line by line in the different counts and determining whether or not there is subject matter jurisdiction,” Crutchfield said.  “That statement is concerning in a much broader implication than just this case.”