On March 16, 2012, Rossdale CLE hosted an attorney’s fees telephonic seminar of about about 2 1/2 hours, with presentations being made by three attorneys: Kent Rutter of Haynes and Boone, LLP (Houston, TX), Susan P. White of Manatt, Phelps & Phillips LLP (Los Angeles, CA); and co-contributor Mike Hensley. [Ms. White and Mike also spoke on different panels at the Fall 2011 NALFA fee seminar, with a summary of their presentations available on our prior November 20 and 25, 2011 posts.] Here is a summary of their presentations:
Mr. Rutter -- Effectively Recovering Attorney’s Fees In Federal Court.
1. In federal court, a prevailing party is generally a litigant who recovers on a significant issue in the litigation (even if a partial victory) or achieves some of the benefits of the suit (although a procedural victory usually does not qualify; nominal damages will qualify, but may result in a denial or reduction of fees).
2. FRCP 54(a), if the fees are not damages, is the way to claim, but with the necessity of a written motion made no later than 14 days after the entry of judgment unless a statute or court order provides otherwise (with local rules sometimes trumping this deadline). Do not rely on post-judgment motions to extend this deadline, although there is some authority indicating that they may do so. There are three requirements under Rule 54(a): (1) a judgment; (2) grounds for fee award; and (3) statement or estimate of fees sought.
3. Evidence to support fee requests should be good billing records.
4. FRCP 54(d) requires findings of fact/conclusions of law in a fee proceeding.
5. Strategies to maximize fee awards: (a) apportionment -- compensable versus noncompensable claims should be apportioned out, unless they are intertwined (with this latter being a function of the overlap or commonality of facts); (b) estimate post-trial fees (fees on fees) so that the district judge can either award or defer until a final, final result; and (c) include appellate fee estimate in Rule 54 request so that district court can defer and ask appeals court to reward fees or remand to the district court.
Ms. White -- Effectively Recovering Attorney’s Fees in Insurance Coverage Contexts.
1. She has successfully argued that reasonable hourly rates should be the appropriate benchmark in arbitrations involving the hourly rate that should be awarded to separate counsel appointed to defend an insured (aside from carrier-appointed panel counsel) in mandatory arbitrations set to determine what rates should govern separate counsel’s work efforts.
2. For policies where there is no duty to defend but just pay defense costs at some point in time (e.g., D&O, E&O, or employment practices policies), Ms. White opines that the carrier has a contemporaneous duty to pay rather than wait until the end of the case to pay for the insured’s defense.
3. With respect to payment of the defense of covered versus uncovered claims, she observed that many policies have allocation provisions, some paying based on the percentage of covered claims but some having pro-insurer “relative exposure” nuances. Nonetheless, defense counsel needs to keep detailed time records that do apportion out work so that maximum fee recovery can be made for covered claim work.
4. For insurance policies requiring insured’s consent to the insurer’s appointment of defense counsel, she advised that the insured needs to resolve this consent issue early on in the process to minimize disputes and maximize fee recovery.
5. Ms. White also discussed insured’s recovery of fees for gaining policy benefits under California’s Brandt decision, as well as the numerical formulas guiding cases involving contingency fee arrangements that were articulated in the Cassim decision.
Mike Hensley -- Effective Fee Petition Submission and Opposition Tips.
1. Attorney credibility is the overarching theme for fee petition submissions and oppositions; once lost, can be fatal to recovering fees or challenging them.
2. You need to give trial and appellate courts a roadmap, even though California judges do not have to issue a statement of decision in fee proceedings. (In federal court, district judges do have to issue a reasoned order in such proceedings.)
3. For fee claimants, the key documents are the declarations of lead/assistant counsel and any fee experts in support of fee request. Here are the topics and some beneficial testimony that should be discussed/included:
A. Reasonableness of hourly rates (including helpful rates awarded to the submitting counsel in other similar cases in the venue);
B. Detailed billings and a summary of the time for major litigation tasks;
C. Highlight any discounts in overall fees or discounts in hourly rates;
D. Highlight any non-charges;
E. Show efficiencies -- good delegation of work effort/good staffing (keep
inter-office conferencing and “up to speed” conferences to prudent levels);
F. Do not block bill or make a discount upfront in the submissions for doing so;
G. Show efforts to settle the case and efforts to settle the fee dispute itself;
H. Demonstrate the opposing parties’ expended fees and costs to show reasonableness of your client’s fee request;
I. Do not attempt to pass through “overhead” expenses, keeping in mind most state and federal judges will find Westlaw/LEXIS charges to be overhead and will not award;
J. Review other timekeeper billings for consistency with the other submitted billings; and
K. Obtain declarations from other attorneys in the venue who can attest to reasonableness of hourly rates/work efforts or retain independent fee expert to testify to the same. [In class actions, will need this testimony to support positive enhancement multipler requests.]
4. In opposing fee submissions, attack the topics highlighted above, but make sure the challenges the specific and particularized in nature. You can obviously show your fees were much less in nature, but probably need a fee expert on reasonableness of hourly rates or to audit work efforts.
5. Provide the court with a proposed statement of decision or proposed findings of fact/conclusions of law.
6. On possible standard of care issues relating to fee exposure, investigate and advise clients in contractual fee litigation matters about the availability of protective insurance underwritten through Sonoma Risk.
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