CALIFORNIA ATTORNEY'S FEES

Continuing Legal Education: Co-Contributor Mike Will Present “California Attorney Fees 2020” Webinar For Bridgeport Continuing Education On May 12

Time Slot Is 10:00 – 11:30 A.M., Including Ability To Field Questions From Participants.

            On May 12, between 10:00 – 11:30 a.m., co-contributor Mike will present “California Attorney Fees 2020,” a webinar through Bridgeport Continuing Education which features a detailed power point presentation as well as the ability to field questions from participants.

            This program will focus on tips for claiming and obtaining California attorney’s fees in both California state and federal courts.  It will cover, among other things, these topics:  (1) bases for requesting attorney’s fees; (2) how to structure fee petitions/motions; (3) how to attack fee petitions/motions; (4) how to develop the record in fee proceedings and what type of orders to request/fashion for future appeal; (5) tips for arguing fee issues before California state appellate courts/the Ninth Circuit Court of Appeals; and (5) selected issues of importance in the arbitration, SLAPP, civil rights, family law, private attorney general, and class action areas.

            More information is available from www.bridgeportce.com.

Continuing Education: May 2017 Edition Of Orange County Lawyer Has Good Instruction Guide For State Court Attorney’s Fees Motions

Author Steven S. Streger Is Orange County Superior Court Senior Staff Attorney.

 

            Steven S. Streger, a senior staff attorney with the Orange County Superior Court, has authored an article in the May 2017 edition of the Orange County Lawyer, aptly entitled “Attorney Fee Motions:  Hunting for Fluff and the Avoidable Haircut.”  Given his position with the court, here is our summary of his pointers for practitioners filing attorney’s fees motions in state court (especially the OC venue):

Identify with precision the legal basis for the fee award. This means make sure you have fee entitlement—usually, a basis in contract, statute, or an equitable doctrine.

Explain in detail your client’s entitlement to fees. This means that the fee claimant needs to meet the “prevailing party” test under Civil Code section 1717 or other governing statutes.

Justify the amount of fees sought. This means satisfying the lodestar test, with Mr. Streger observing that surveys, matrices, declarations, or citation to cases awarding fees in like situations are probably necessary where high hourly rates are requested.  He also urges claimants to “prove your time investment” through detailed, partially-redacted billings, specific attorney declarations describing the work in detail, and substantiation which avoids block billing.

Avoiding the haircut. Streger presents five rules of thumb to keep in mind so as to avoid an unwanted fee “haircut”:  (1) the trial court has an independent obligation “to hunt for fluff”; (2) the “hunt for fluff” covers padding, over-conferencing, attorney stacking, over-staffing, duplication, marked inefficiency, and services righteously performed but seemingly pointless; (3) trial courts do not have to provide a detailed explanation of haircuts; (4) credibility counts, especially if apportionment is obvious for limited success or for work on non-compensable claims; and (5) the higher the hourly rate, the deeper the dig by trial judges, quoting Circuit Judge Weis:  “A Michelangelo should not charge Sistine Chapel rates for painting a farmer’s barn.” 

MCLE/Ethics: Ensure That Your Clients Pay Your Fees

Professional Responsibility Article Covers Basics Of Proper Retainer Letter And Attorney Billing Practices.

     Under the heading “Ensure That Your Clients Pay Your Fees”, attorney Lorraine M. Walsh of Walnut Creek has written an ethics/professional responsibility article that appears in the November 4, 2016 on-line edition of the Los Angeles Daily Journal.  Ms. Walsh covers basic rules for fee contracts in California, rules for bills, common improper billing practices to avoid, and unenforceability of a dispute waiver provision.  Plus, California State Bar members can then click to an MCLE test that they can take for MCLE credit.

Continuing Legal Education: California Lawyer Subscribers Can Attend Free Webinar On “Top Billings Mistakes Attorneys Make And How To Fix Them”

 

May 19, 2016 Is The Date.

    For you readers who are California Lawyer subscribers, there is a free Webinar on May 19, 2016 between 9:00 – 9:30 a.m. PT being offered on the topic of “Top Billing Mistakes Attorneys Make and How To Fix Them.”  Here is an informational link on the webinar. 

Continuing Legal Education: October 2014 Issue Of Orange County Lawyer Has Two Fee Oriented Articles Of Interest

 

First One Deals With “Patent Trolls” Hit With Patent Fee-Shifting Exposure.

     John O’Rourke, Patrick Soon, and Rebecca Bellow have written a colorfully titled article “Silver, Garlic, and Attorney’s Fees.” It focuses upon one of the initial post-Octane Fitness decisions where a plaintiff “patent troll” was ordered to pay attorney’s fees to a defendant in an unsuccessful patent infringement case. U.S. District Judge Cote did order shifting of fees against the unsuccessful “patent troll” in FindTheBest.com, Inc. v. Lumen View Tech. LLC, 13 Civ. 6531 DLC, 2014 WL 2050610 (S.D.N.Y. May 19, 2014), with the authors questioning if this would have occurred absent SCOTUS’ decision in Octane Fitness.

Second One Deals With Structured Personal Injury Settlement and Contingency Fee Recovery Concerns.

     For personal injury practitioners, Mary A. Dannelley has written a thoughtful article entitled “Plaintiffs’ Lawyers Beware: Structured Settlements Can Sour the Attorney-Client Relationship.” The main problem focuses on how a contingency fee should be paid in the event of a structured settlement, especially if the contingency fee agreement is silent on the subject. The big case in this area is Knight v. Aqui, 966 F.Supp.2d 989 (N.D. Cal. 2013), which provides a virtual “roadmap” on this subject. We will not dwell on the details, but this article is very useful in analyzing Knight and California ethical rules—but it does suggest that clarity in the retention agreement is a must to avoid problems.

Continuing Legal Education: November 2014 Edition of California Litigation Has Article Entitled “California Attorney Fee Orders: When to Appeal, Defend or Settle”

 

 

Audra Ibarra Is the Author.

 

     In the November 2014 edition of California Litigation (the journal of the Litigation Section, State Bar of California), sole practitioner Audra Ibarra has written an article, “California Attorney Fee Orders: When to Appeal, Defend or Settle.” Here are the highlights from this article after she observes that one has an 18% chance of reversal based on Judicial Council 2013 court statistics:

     1. A jurisdictional concern is a classic ground for de novo review and reversal.

(Center for Biological Diversity v. County of San Bernardino, 188 Cal.App.4^th 603, 608, 611 (2010) [supplemental fee fixing order].)

     2. A prevailing party’s entitlement to fees on undisputed facts is usually reviewed de novo. (People ex rel. Dept. of Corporations v. Speedee Oil Change Systems, 147 Cal.App.4^th 424, 427-428 (2007).)

     3. Interpretation of the statutory criteria for fee entitlement (example: private attorney general area) is a de novo review exercise. (Conservatorship of Whitley, 50 Cal.4^th 1206, 1213 (2010) [one of our Leading Cases].)

     4. Whether a published decision may justify attorney’s fees under the private attorney general statute is subject to de novo review. (Wilson v. San Luis Obispo County Democratic Central Comm., 192 Cal.App.4^th 918, 924 (2011).)

     5. How a contractual fees clause affects a third party is frequently scrutinized under a de novo standard. (Whiteside v. Tenet Healthcare Corp., 101 Cal.App.4^th 693, 707 (2002).)

     6. Whether a third party (such as an attorney) has sufficient interest or standing in a fee award to support intervention is subject to de novo review. (Lindelli v. Town of San Anselmo, 139 Cal.App.4^th 1499, 1502, 1505 (2006).)

     BLOG UNDERVIEW—Ben Shatz, an appellate specialist practicing with Manatt, Phelps & Phillips, LLP in Los Angeles, is now editor of California Litigation.

     Co-contributor Marc, in the November 2014 edition, has penned a letter to the editor on “plagiarism punch-out.”

Continuing Legal Education: Manatt’s Susan White, Co-Contributor Mike, And Dallas Attorney Charlie Wilson Speak On Attorney’s Fees At June 10, 2014 Rossdale CLE Conference

 

Tips on Insurance and Fee Petitions Presented by All Panelists.

     On June 10, 2014, Rossdale CLE—a Florida based CLE provider—hosted an attorney’s fees seminar with Susan White of Los Angeles’ Manatt, co-contributor Mike of Santa Ana’s AlvaradoSmith, and Charles M. “Charlie” Wilson III of Dallas’ Goranson Bain. They each provided a 30 minute discussion relating to tips on successfully presenting and opposing fee applications, with Ms. White’s discussion centering on insureds dealing with insurers having obligations to pay/defend. Here is a summary of what each had to say:

Susan White – Insurance.

1. Who pays the bills: depends on the type of policy. General liability (“duty to defend”) policy is where insurer hires counsel to defend. Defense costs policy (such as D&O) is where insurer pays or reimburses the defense costs, often using recommended panel counsel.

2. Duty to defend policies: usually insurer will defend with or without reservations. Insureds must watch for conflict in retention of an attorney who might skew the defense in favor of insurer as far as coverage; in California, this entitles appointment of independent Cumis counsel (which is different than insurer panel counsel).

3. What rates do insurers pay independent counsel? In California, they are the rates actually paid by insurer to counsel retained in ordinary course in similar cases. Questions arise as to what this means; burden is on the insurer in California and issue can be arbitrated.

4. TIPS FOR INSUREDS: communicate with insurer frequently and often; meet with independent counsel and communicate back with input to insurer on regular intervals; try to settle any disputes.

5. When must the insurer pay: generally, when the defense costs are incurred under duty to defend policy; insurers are known to delay, so monitor often.

6. Allocation issues: this involves covered versus uncovered claims. Usually, the general rule is that the insurer under duty to defends policies must pay the entire time to defend except for “with reservation caveats” and insurance policy provisions allowing recapture of fees on claims ultimately found not be covered. However, defense counsel should break out and describe claims being worked on with specificity in billings.

7. There is a reasonableness presumption about fees if insureds pay the bills: the presumption is against the insurer. This means preparing proper time sheets with detail which are promptly forwarded to insurer for reimbursement. TIPS ON BILLING: Do not block bill (insureds do not like); do .1 rather than .25 time increments; avoid duplication and vague entries; apportion time between contract policy issues and tort claims; avoid too much inter-conferencing; insurers usually will not reimburse for first class travel; review, follow, or reasonably protest insurer billing guidelines.

Mike Hensley—Proving Reasonableness and Rates of Fees/Costs.

1. In prosecuting or opposing fee applications, provide the judge a roadmap (because most fee proceedings are “costs” issues heard by the judge). Attorney credibility in the prosecution or opposition to fee petitions is critical.

2. As a claimant, make sure you have a fee entitlement basis. Most jurisdictions follow the American Rule—party pays for own fees and costs unless contract or statute says otherwise.

3. Look for conflict of law issues which may affect recovery. Example: McKesson Corp. v. Islamic Republic of Iran, No. 01-7041 (D.C. Cir. June 3, 2014) – Iran applied to fee entitlement, resulting in appellate reversal of $13.4 million fee award down to Iran official tariff capped amount of $29,516.

4. Look for instances of judicial or pleading estoppel. Opponent to fee application pled or asked for fees also; in California, still have to have a fee entitlement basis but other jurisdictions accept an estoppel theory.

5. Think about requesting discovery of the opponent’s hourly rates and what they spent on the case. Most federal courts find this probative evidence for a fee claimant; state courts are more split on the issue.

6. Make sure you follow the time deadlines for bringing fees and costs requests.

Also, if you do not like a fee ruling, most fee awards are separately appealable and must be separately appealed.

7. Utilize lodestar/multiplier analysis in most jurisdictions. However, know your

particular venue – example: in class actions, most federal courts used percentage of recovery as primary test (usually 25% of a fund or estimated recovery) cross-checked by lodestar method; in California, lodestar is the primary check cross-checked by percentage of recovery in class actions.

8. As a claimant, provide a detailed declaration by the lead or supervising

attorney, which indicates experience of all attorneys/assistants working on the case, describes the litigation in detail; attach contemporaneous, detailed billings (trying to avoid reconstructed time, or explaining why it is reliable); avoid block billing (in California, reductions of 10-30% are routine and sometimes more); apportion out time on unsuccessful claims; give voluntarily reasonable reductions for duplication/inefficiency (in Ninth Circuit, any haircut by district judge over 10% has to be specifically explained – see Moreno v. City of Sacramento, 534 F.3d 1106, 1112 (9^th Cir. 2008); explain any higher hourly rates for a venue (such as no qualified venue-based counsel having expertise in the particular case, especially a factor in more rural or smaller counties); show prior hourly rate awards to the attorneys on the case; for a large matter, consider using a fee expert who is knowledgeable of various studies on hourly rates and has experience in auditing bills; get declarations from credible attorneys in the venue confirming the reasonableness of hourly rates being requested.

9. Provide lower court with a detailed proposed order, statement of decision, or findings of facts/conclusions of law, a roadmap for the appellate court.

10. Avoid misrepresenting the complexity or risks of the case.

11. Attempt to introduce any pre-petition efforts to settle the fee dispute.

12. Introduce evidence about the financial situation of the client where it is relevant (such as in civil rights cases or where financial situation is a factor in the fee analysis).

13. Describe the retention agreement with the client, sensitive to local state rules about retainer agreement confidentiality.

14. Detail equitable factors supporting or militating against a fee award – such as scorched earth tactics of the defense or “over litigation” by the fee claimant.

15. When opposing a fee declaration on unreasonableness of work or fees, make the objections specific.

Charlie Wilson – Fee Claimant “Do’s” and “Don’ts”.

1. Attorneys generally spend very little time to recoup fees; a mistake, given the amounts generally at stake – often, much higher than the award or verdict to the client.

2. Know your forum. Some fees are damages and have to be presented before the jury. The median U.S. family income is $50,000 per year, so they will scoff at large fee requests unless a clear explanation of why such requests are justified. In Texas, judges have more discretion in a fee request matter.

3. Retainer agreements: make the retainer agreement specific on fee recovery and make sure modifications are in line with local ethical rules and that you, the attorney, are fair in any modification negotiations.

4. Fees are usually costs presented to the judge; however, they can be damages which require presentation of proof before juries, such as common fund and “tort of another” circumstances. [CROSS OVER ISSUE WITH MS. WHITE: in California, in Brandt situation, fees are damages; unless a stipulation to present before judge is agreed to, fees are determined by the jury.]

5. In Texas, there are fee limitations on noncash benefit recoveries in class actions, with attorneys getting lower fees for these types of benefits.

6. Recommendation to engage an outside fee expert in large fee recovery cases because the expert will review the matter with a clean slate and can give an independent view of the fee request.

7. For claimants, make sure all attorneys show their experience in years as well as substantive areas.

8. Use annual state bar surveys on hourly rates, where available.

9. Segregation of fees: billing should exclude noncompensable time or break this time out; in Texas and many federal courts, the burden of segregation is on the fee claimant and the “intertwined” theory will not blunt the need for apportionment.

10. Show any “no charges” on the billings; judges and juries like this.

11. Show billing judgment – this indicates that you are “self monitoring” attorney billing – avoid billing 8.0 hours 13 days in a row, this is a red flag which tells the judge or jury that there is no monitoring of the attorney so billing.

12. In federal courts, district judges do look at prior fee awards in similar cases.

13. Fee claimants get mileage by making voluntary reductions in the fee request, especially reductions suggested by the fee claimant’s expert.

14. “Don’ts” to avoid in attorney billing practices: (a) excessiveness—turning a single plaintiff case into a class action as far as time billed; (b) failure to segregate distinct claims—in Texas, this failure to do so means fees will be unrecoverable in most cases; (c) vague entries—federal judges will discount and avoid submitting redacted billings (no reason to put privileged matters in entries in the first place); (d) block billings—courts do not like, because it is a sign of camouflaging work; (e) do not persistently bill for long days, unless on an intensive, rush project, trial, or you are multi-tasking on a couple of intense projects; (f) avoid overstaffing; and (g) avoid excessive inter-conferencing with other attorneys or assistants.

15. Billing rates usually depend on the complexity of the case. A good starting point is local bankruptcy court procedures on both rates and manner of billing time.

Continuing Education: Orange County Superior Court Judges Andler and Colaw Provides Some Types On How They Approach Discovery Sanctions Requests Before Their Departments

 

They Also Provide Useful Law and Motion Tips.

     On March 7, 2014, the Orange County Bar Association (Business Litigation Section) hosted an MCLE program entitled “Are You Arguing Motions Effectively?” with the judicial panelists being Orange County Superior Court Judges Gail A. Andler and Thierry P. Colaw.

     One of the topics was each judge’s view on assessing discovery sanctions. Judge Colaw indicated that he would assess them, although usually on a several basis unless the attorney was really participating in the process. Judge Andler indicated that she grants discovery sanctions to “level the playing field,” with it being a cost of business in the discovery context. Both judges indicated that sanctions were viable even if the opposing side produced discovery responses on the eve of a motion unless a good excuse was offered.

     As far as other tips, here is what was offered by both jurists: (1) don’t rehash (at best, a simple summary of key points); (2) focus on a tentative decision; (3) make evidentiary objections in writing; and (4) have motions in limine address true evidentiary issues (although Judge Colaw did indicate that some amount of “education” might be helpful through such motions, if not overdone).

Continuing Education . . . . 2013 NALFA Attorneys Fees Conferences Focuses On Class Actions And 4/3 DCA Justice Thompson Shares His Experiences With Orange County Bar Appellate Section

 

 

NALFA Conference in San Francisco.

            The National Association of Legal Fee Analysis (NALFA) held its 2013 annual Attorneys Fees Conference in San Francisco on October 23, 2013.   Although neither of the co-contributors of this blog were able to attend due to conflicts, looks like class actions were a dominant part of the discussion.  One panelist indicated that judges were imposing more modest multipliers, generally preferring to use the percentage of fund approach.  Nobody is going to get 10 to 20 times lodestar multiplier anymore, the panelist opined.  (NOTE:  In California state courts, the lodestar is the primary approach, “cross checked” by the percentage of fund approach--although this latter approach is the one preferred in most U.S. district courts.)  William Downes, a former Wyoming federal judge, indicated that he did once award $10.5 million in fees to securities class action attorneys, which equated to a 25% percentage of the fund and a 2.78 multiplier.  Judge Downes also expressed the opinion that successful class action attorneys may get larger fees given the class action certification obstacles having to be hurdled.

Justice Thompson’s First Year Observations From the Appellate Bench.

            Justice David Thompson is the most recent appointee to the Fourth District, Division 3 appellate court (based in Santa Ana).  In early November 2013, he provided some observations about his first year on the appellate bench to members of the Orange County Bar Appellate Section.  Here are the highlights:

            1.   Briefs generally are too long and need to be edited to delete unnecessary repetition.

            2.   Factual recitations in briefs need to show both the good and the bad, as appellate review standards dictate.

            3.   He believes in concurring and dissenting opinions, seeing them as a way to keep developing jurisprudence--if these viewpoints are necessary.  (To show that he believes in this, see his recent dissenting opinion in the Lueras decision.)

            4.   Most appeals do not involve “cutting edge” or “exciting” issues. 

            5.   The biggest change for him (he was superior court judge who was elevated to the appellate bench) is the “loneliness” factor--he mainly has contact with his clerks, versus lawyers, clerks, parties, and other superior court colleagues while he was a lower court jurist. 

Continuing Legal Education: NALFA’s 2013 Attorney Fee Conference Scheduled For October 25, 2013 In San Francisco

NALFA

     The National Association of Legal Fees Analysis (NALFA), which has its own website and an excellent fee blog, is hosting its 2013 Attorney Fee Conference at the San Francisco Bar Association on October 25, 2013.

     The 2013 conference includes 20 panelists and 3 current/past judges, including Hon. Richard Kramer (San Francisco Superior Court--Complex Civil Litigation Division); Hon. William F. Downes (former U.S. District Judge, D. Wyo., and current JAMS neutral); and Hon. Cruz Reynoso (former Associate Justice of the California Supreme Court and, earlier, Associate Justice of the Third District Court of Appeal and now a Professor of Law Emeritus at UC Davis School of Law).

     Here are some of the conference topics:

     1. Managing Outside Legal Spending;

     2. Corporate Law Department Management;

     3. Navigating Fee Disputes--Courts versus ADR;

     4. Tips and Tactics for California’s Mandatory Fee Arbitration Program;

     5. Economics of Attorney Fee Awards;

     6. Economic and Non-Economic Factors in Attorney Fee Awards;

     7. Complex Attorney Fees Issues in Class Action Settlements;

     8. Fee Motion Practice in Complex Multi-Million Dollar Fee Applications; and

     9. Proving Attorney Fees and Importance of Experts.

Continuing Education: Co-Contributor Mike, Kent Rutter, And Susan White Speak On Various Attorney’s Fees Topics At Rossdale CLE Telephone Seminar On March 16, 2012

 

     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.

Continuing Education: NALFA’s 2011 Attorney’s Fees Conference Panel No. 4

 

Discusses “Insurance Coverage Litigation: Who Pays The Legal Bills?”

Part 4 of 4

[Links to Parts 1, 2 and 3]

     The last panel of NALFA’s 2011 Attorney’s Fees Conference on November 17, 2011 discussed “Insurance Coverage Litigation: Who Pays the Legal Bills?” The panelists in Panel No. 4 were Andre E. Jardini (of KPC Legal Audit Services, Inc.), Susan P. White (of Manatt Phelps & Phillips, LLP), and Susan J. Field (of Musick Peeler & Garrett, LLP).

 

Continuing Education: NALFA Panel 3 Addresses “Attorneys’ Fees in Chapter 11”

 

Part 3 of 4

[Links to Parts 1, 2 and 4.]

     At the November 17, 2011 Attorney Fees Conference hosted by NALFA at Loyola Law School, the third panel examined “Attorneys’ Fees in Chapter 11.” That panel was composed of U.S. Bankruptcy Judge Deborah J. Saltzman (C.D.Cal.), Craig H. Averch (of White & Case LLP), Eric Winston (of Quinn Emanuel Urquhart & Sullivan, LLP), and David Paige (of Sterling Analytics).

Continuing Education: NALFA 2011 Attorney Fees Conference Examines “Class Action Litigation and Attorney Fee Awards”

 

Part 2 of 4

[Links to Parts 1, 3 and 4]

     The second panel of the NALFA 2011 Attorney Fees Conference held on November 17, 2011 at Loyola Law School discussed “Class Action Litigation & Attorney Fee Awards,” consisting of panelists Los Angeles County Superior Court Judge Carl J. West, Aashish Y. Desai (of Mower Carreon & Desai, LLP), and Brian S. Kabateck (of Kabateck Brown Kellner, LLP). Here are the highlights from this panel discussion.

Continuing Education: NALFA 2011 Attorney’s Fees Conference

 

Part 1 of 4: “Attorney Fees in Prevailing Party Litigation”

[Links to Parts 2, 3 and 4]

     National Association of Legal Fee Analysis (NALFA), through the coordination of Executive Director Terry Jesse, held the 2011 Attorney Fees Conference at Loyola Law School on November 17, 2011. There were four panels, and we will blog on all of them.

     First up, the panel on “Attorney Fees in Prevailing Party Litigation,” conducted by panels Hon. Jay C. Gandhi (U.S. Magistrate Judge, U.S.D.C., C.D.Cal.), Mike Hensley (a co-contributor on this blog), and David H. Paige (of Sterling Analytics Group, Woodbury, N.Y.).

Continuing Education: MCLE Available For NALFA’s 2011 Attorney Fee Conference

 

Co-Contributor Mike Participates on a Panel at this Conference.

     Although it was supposed to be held earlier in the year, the National Association of Legal Fee Analysis (NALFA) is holding its 2011 Attorney Fee Conference at Loyola Law School on November 17, 2011 between noon-5 p.m. You can gain MCLE credit if you attend, with more details available on NALFA’s website.

     Co-contributor Mike will be on a panel with U.S. Magistrate Judge Jay C. Gandhi (C.D.Cal.) and Davis H. Paige of Sterling Analytics Group. This particular panel deals with “Court Awarded Attroney Fees in Prevailing Party Litigation,” although there will be panels on class action, insurance, and other issues of interest in the attorney’s fees area.

CONTINUING LEGAL EDUCATION: Proviors, LLP Sponsors “Contract Litigation and Effective Motions for Attorney’s Fees” Seminar in Century City on July 8, 2011

Panelists Were Kevin Martin, Gerry Knapton, and Co-contributor Mike Hensley.

     Co-contributors Marc and Mike attended an MCLE seminar hosted by Proviors, LLP which was appropriately titled “Contract Litigation and Effective Motions for Attorney’s Fees” on July 8, 2011 in Century City.

     Besides co-contributor Mike, the other panelists were Kevin Martin, CEO of Sonoma Risk Insurance Agency (which offers Contract Litigation Insurance, as discussed in our prior posts of August 3 and 6, 2010) and Gerald G. (Gerry) Knapton, an acknowledged fee expert and partner with Ropers Majeski Kohn Bentley of L.A.

     Here are some interesting points and tips that were made at this seminar:

     *Mr. Knapton, who has developed many of the California State Bar sample retainer agreements, stressed the importance of making sure (1) attorneys mention hourly rates, (2) attorney’s fees shifting is covered if a litigated/arbitrated dispute arises with a client (including a Trope waiver based on Lockton v. O’Rourke, 184 Cal.App.4th 1051 (2010)), (3) attorneys include a clause stating that the retainer letter applies if the client has the attorney work on other matters for clients or affiliates, and (4) reimbursement of specialized costs such as computerized research is desired (spell it out). Also, make sure you customize the State Bar forms to your particular client retention.

     *Mr. Miller described the benefits of purchasing Contract Litigation Insurance (CLI), which will cover a court-ordered award of attorney’s fees to a prevailing party based a contract (Civil Code section 1717) claim subject to certain underwriting and other policy conditions. He noted that 70% of the litigated contract disputes overall involve fee clauses, with the percentage coming closer to 100% for leases and real estate purchase disputes.

     *The panelists agreed that it was at best ambiguous whether the existence of CLI had to be disclosed in response to California state form interrogatory requests, given that they seem to be more broadly worded to only encompass the substantive claims in a particular suit.

     *Mr. Knapton encouraged fee claimants to obtain discovery or disclosure of what an opponent spent in fees, noting that Florida requires the filing of fees under seal on a periodic basis in a case. Co-contributor Mike observed that the majority federal approach would allow discovery or disclosure of an opponent’s fees, while California state judges are much more split on the propriety of allowing disclosure of such fees. (Rob Stein, a colleague of co-contributors Marc and Mike, noted that N.D. Ill. district court rules require an opponent to disclose fee expenditure totals when a fee proceeding is in dispute.)

     *All panelists agreed that a fee claimant needs to provide a “roadmap” to trial and appellate jurists on fee requests, which segues in completely with Justice Richard Fybel’s sentiments at a past L.A. County Bar Appellate Division seminar.

     *Mr. Knapton stated that a good fee motion should discuss three topics: RESULTS; TIME; FEES. He believed that most trial/district judges do not dissect voluminous billing statements; though they will look at some samples of entries, it would behoove the claimant to prepare an Excel spreadsheet summarizing the time and fees based on major tasks in the litigation. Co-contributor Mike chimed in that the claimant needs to provide at least a bullet-point summary of the tasks and time spent on the tasks to remind the reviewing judge of the work that was expended, making sure that claimants highlight any discounted hourly rates, gratis fee reductions, and allocations when there are compensable versus non-compensable issues

     *Mr. Knapton informed seminar participants about the utility of using the Laffey Matrix, adjusted by localized costs of living, when it came to arriving at a reasonably hourly rate. Gerry and co-contributor Mike also indicated other information could be used, such as national and regional surveys, published/unpublished decisions about hourly rates for the relevant venue, and declarations from local attorneys confirming the reasonableness of the hourly rates being claimed.

     *For specialized intellectual property litigation, Mr. Knapton recommended supporting higher hourly rates by using the Report of the Economic Survey of the American Intellectual Property Law Association (AIPLA Report), which has been endorsed in this area. (See Mathis v. Spears, 875 F.2d 749, 755-56 (Fed.Cir. 1988).) Co-contributor Mike also observed that state judges seem to be more conservative on hourly rates, while federal courts are more liberal in this area.

     *Mr. Knapton suggested that overbilling/duplication/inefficiency challenges should be supported by using the State Bar advisory publication “How to Detect Attorney Fee Padding.” Gerry and co-contributor Mike explained the significance of Chavez v. City of Los Angeles, 47 Cal.4th 970 (2010), where California state courts have discretion to reject or reduce large fees requests under FEHA (a pro-plaintiff fee shifting scheme) if plaintiff’s recovery was small or the case was not very complex.

     *All panelists agreed that block billing was a big “no no,” which will usually lead to some serious judicial discounting (routinely ranging around 15-30%)--but more on some occasions.

     BLOG UNDERVIEW--This was a terrific seminar. However, co-contributor Mike did feel somewhat like comedian George Gobel when he appeared on a Johnny Carson late night interview on New Year’s Eve one year. Johnny interviewed Mr. Gobel that night, alongside Bob Hope and Dean Martin. That prompted Mr. Gobel to say, just as co-contributor Mike felt with such panelists as Messrs. Martin and Knapton, “Did you ever get the feeling that the world was a tuxedo, and you were a pair of brown shoes?” There you go!

Continuing Legal Education: NALFA Will Host Its 2011 Attorney Fees Conference At Southwestern Law School On June 16, 2011

Co-contributors Marc and Mike Will Be There.

     The National Association of Legal Fee Analysis (NALFA), an organization specializing in attorney’s fees and legal billing with a national practice group of attorney’s fees experts, will be hosting its 2011 “The Attorney Fees Conference” at Southwestern Law School in Los Angeles on June 16, 2011. It will be held noon-5 p.m. with a cocktail networking reception.

     Topics will include: court awarded attorney fees in prevailing party litigation; class action litigation and attorney fee awards; attorney fees in Chapter 11 bankruptcy cases; insurance coverage litigation: who pays the legal bills?; reviewing legal bills for reasonableness; and disputes over legal fees: litigation versus arbitration.

     Co-contributors Marc and Mike will be there, with Mike being one of the speakers on the prevailing party panel. For more information on this upcoming event, you can find it by going to www.thenalfa.org.

Second Annual Los Angeles Attorney Fee Conference at Southwestern Law School

Theme:  "It Pays to Be Reasonable"

 

     The L.A. Attorney Fee Conference is scheduled this year at Southwestern Law School, Los Angeles, California, June 24, 2010.  The lunch buffet is scheduled noon to 1 p.m., and the CLE program is scheduled 1 p.m. to 5 p.m.  Mike and Marc have attended the program in the past.  The conference is useful and informative for those interested in attorney fee jurisprudence.  For more information on the program, or to register for this program, visit www.thenalfa.org/CLE-Programs

 

 

Which Matters Most: The Dog or The Litigation Fee Tail? Appellate Practice on Review of Attorneys' Fees Awards

05/11/2010

Presented by: Association Committee Meeting

Subsection/Committee: Appellate Courts

Program Information:
This meeting will explore ways to present fee petitions to obtain successful trial and appellate results; standards of review; statements of decisions and specificity in trial court fee orders; discovery in fee proceedings; and appellate issues encountered in diverse areas such as SLAPP awards, private attorney general awards, Brandt fees, Section 1717 fees, and class action fees.

Speakers:
Marc D. Alexander, Adorno Yoss Alvarado & Smith
Hon. Richard D. Fybel, California Court of Appeal
William Michael Hensley, Adorno Yoss Alverado & Smith
Hon. Robert M. Mallano, Second District Court of Appeal

Location:
California Court of Appeal
300 South Spring Street
Los Angeles, CA

Room: Employees Lounge

Times:
Registration: 4:30 PM
Program: 4:30 - 6:00PM

Prices:

Appellate Courts Committee Members
FREE

1.5 hrs CLE credits including Appellate Specialization and Ethics

Registration Code: 010914

Event Start Date: 05/11/2010 Time: 04:30 PM

Event End Date: 05/11/2010 Time: 06:00 PM

For more information about program registration, click here.

Ellen Peck's January 2009 Article In California Bar Journal Has Nice Tips For Recovering Fees in Contingency, Limited Partner, Executor, and Client Fee Sharing Representations

 

Ms. Peck Reviews Stroud, Shimko, Miller, and Strong Decisions.

     Ellen R. Peck, a former State Bar Court judge and Encino solo practitioner, has written a fine article in the January 2009 edition of the California Bar Journal with astute tips of upfront, prophylactic actions that can be taken for successfully recovering fees in diverse client representation situations. We summarize them here:

NALFA SEMINAR ON JUNE 19, 2008 HAS HIGHLIGHTS ON MANY AREAS OF INTEREST IN THE ATTORNEY’S FEES ARENA

Los Angeles Seminar Provides Valuable Pointers, Which We Summarize Below.

            On June 19, 2008, the National Association of Legal Fee Analysis (NALFA) hosted a Los Angeles attorney fee program, entitled “It Pays To Be Reasonable.”  Marc Alexander and Mike Hensley attended and were impressed by both the speakers and topics, not to mention the setting:  it was held in the renovated Bullock’s Wilshire (a beautiful architectural specimen now the home to Southwestern Law School).  What follows is our summary of highlights from the program.

First Session—“California Fee-Shifting Provisions & Prevailing Party Standards”

            Speakers were Gregory M. Bergman, John P. Dacey, and Ken Moscaret.

·         The five keys to winning attorney fee litigation – consideration of these issues:  (1) entitlement (contractual, statutory, sanction or damage grants); (2) reasonableness (focuses on the lodestar); (3) discretion; (4) apportionment versus inextricably intertwined; and (5) pragmatic concerns and lessons learned – do not inflate fees (this is overreaching, giving the trial court discretion to disregard fee claim altogether or severely reduce the claim) and take a credible position (reduce fees, apportion out work for fees that are not awardable, and submit good fee substantiation).

·         Ken Moscaret mentioned that federal courts usually adopt a forum rule for determining the lodestar hourly rate (the venue controls), whereas California—as PCLM shows—may follow the home rule, allowing a San Francisco attorney to charge S.F. hourly rates even though the litigation was venued in Los Angeles.

·         Reasonableness of hours billed will be judged by looking primarily at these factors:  (1) case staffing—number of personnel on cases; (2) whether there was an appropriate mix of attorneys (senior versus junior); (3) whether work was reasonably delegated to less expensive, but competent billers; (4) whether there was duplication of effort; (5) whether work reflected junior attorney training time; (6) whether work included improper secretarial or overhead charges; and (7) whether the time entries were adequate (i.e., no block billing).

·         John Dacey indicated that a trial judge most frequently uses the “asshole factor” in using his discretion to award fees—if the other side drove the work up, more fees will be awarded; however, if the plaintiff did shoddy work or was not very credible, expect lower or no fees. 

·         Mr. Dacey indicated that a judge is likely to award costs for materials or information that he sees or that he sees are used during the litigation.

·         Ken Moscaret stated that the party seeking apportionment has the burden, and generally must do the apportionment for the court.

Second Session – “Attorney Fee Recovery in Commercial Litigation”

            Speakers were Greg Bergman and John Dacey.

                        

·         Mr. Dacey stressed that litigants in fee motions should make sure the trial court discusses, on the record, the factors he/she used in deciding why a claimant was entitled to fees or why the court did not award fees or reduced them.

Third Session – “Attorney Fees in Class Action Litigation”

Speakers were Aashish Y. Desai, John N. Quisenberry, and James C. Martin.

·         John C. Martin expressed the view that class action attorney’s fees are, more than fees claimed in other areas of the law, subject to a very transparent “fishbowl” type of review.  This greater degree of judicial scrutiny comes about because (1) the press has painted class action attorneys as lining their pockets to the detriment of the class; (2) there are objectors who often time show up (with standing to appeal their complaints); and (3) only the court can protect the class on the fee issue once class notice is disseminated.

·         Aashish Y. Desai expressed the opinion that it is better to be in federal court rather than state court as far as recovering class action attorney’s fees.  He believes that federal courts are better on reversion issues and awarding a percentage of the entire settlement fund.  In federal court, he noted that the percentage of recovery approach is the Ninth Circuit benchmark, with the lodestar approach being a cross-check on reasonableness. 

·         John N. Quisenberry stated that plaintiff attorneys usually run into trouble recovering the fees they want where (1) the benefit to the class is small; (2) the benefit to the class is large but counsel did not put many hours or expenses into the matter; or (3) the court believes the fee settlement reached between plaintiffs and defendants was too cozy—e.g., cheap settlement, reversion of unclaimed settlement fund amounts, and payment of all plaintiffs’ large attorney’s fees even though little time was spent.

·         Mr. Martin synopsized the three standards of appellate review used for fee awards:  (1) for factual disputes, clear error in federal courts and substantial evidence in state courts; (2) de novo for applying the legal standards when exercising discretion; and (3) abuse of discretion, which displays the trial court’s reasoning on the facts and the law.

·         Mr. Martin then stated what he believed to be the four factors used to review lower court fee awards:  (1) the legal basis for the award (the authorization and whether it fits the case); (2) methodology used in calculating the fee award (which is the area where there is greatest scrutiny); (3) factual and legal support for the award; and (4) the reasoning the lower court used to award or deny fees.

·         Mr. Desai provided his synopsis of the lodestar and multipliers awarded by federal and state courts.  For consumer state cases, he has seen 3 to 5 multipliers, versus 1 to 3 multipliers in federal consumer case counterparts (due, he believes, to the U.S. Supreme Court’s Day decision, where Justice Scalia discounted looking at the contingency risk factor).  Mr. Martin added that if plaintiffs’ counsel is claiming a multiplier north of 3 in either federal or state court, that counsel better be prepared to show exceptional results and exceptional services.

·         Even with the 25% Ninth Circuit percentage-of-recovery benchmark, Mr. Martin suggested that plaintiffs’ counsel should still show the court the reasonableness of this sought-after percentage.

·         Mr. Martin then advised on how plaintiff fee claimants can prove the reasonableness of hourly rates being claimed—(1) declarations from other attorneys in the community regarding hourly rates; (2) fees awarded in similar cases (from jury verdict tally services); (3) declarations from experienced retired judges; (4) mediator declarations describing the settlement efforts (but not the substance); and (5) results from national and local surveys. 

·         Mr. Martin also suggested that the plaintiffs’ counsel discuss the reasonableness standard and factors in their moving papers so that the trial court can “borrow” that discussion.  Plus, he suggested that the claimant provide a proposed order with findings.  Last, he strongly recommended that the claimant create a record of the trial court’s reasoning for the fee he/she awarded or did not award.

Fourth Session – “Attorneys Fees & Legal Billing:  A Practical Guide”

            Speakers were Joel Mark and Gerald F. Phillips.

·         Mr. Mark provided a very comprehensive roundup of recent California ethics opinions and cases, including the Fletcher v. Davis opinion that we reviewed on our May 26, 2008 post.

·         Messrs. Mark and Phillips both indicated that an attorney committing a serious ethical breach or misconduct might forfeit even quantum meruit recovery in the right circumstances.

·         Mr. Mark observed that the ethical screen is a fiction that will not work in state cases, citing Cho v. Superior Court.

·         Mr. Phillips had some great pithy observations – “It’s not hourly billing, but the abuses of it that causes problems” and “dishonest billing is the perfect crime.”

·         Mr. Phillips cited these as the problem areas to avoid:  (1) block billing (federal courts do not tolerate, and state courts are getting more intolerant); (2) overstaffing; (3) minimum number of hour targets for partners or employees; and (4) padding bills.  He believes that (3) creates an incentive to not bill clients fairly for actual time worked.

·         A lawyer in the audience commented that after auditing billions of dollars in attorney bills during his career, he found overstaffing to be the biggest problem, even more so than bill padding.

Fifth Session – “Attorney Fees & Insurance Coverage Litigation”

            

            Speakers were John N. Quisenberry and Ken Moscaret.

·         Mr. Quisenberry provided a tutorial on Brandt, where the California Supeme Court only allowed fee recovery for work performed in obtaining contractual benefits under the insurance policy (not allowing fees for tort recovery or punitive damage recovery).

·         Mr. Quisenberry noted that, in Cassim, 33 Cal.App.4^th 780, the Second District has made it clear that this DCA want to see an allocation of the hours spent on the contract benefits in relation to total hours in order to award Brandt fees.

·         Mr. Quisenberry indicated Brandt allows the jury to consider the amount of fees as damages, and the defense often uses this as a means of distracting jurors’ focus on damning liability facts.

·         Mr. Moscaret discussed Cumis arbitrations, which are binding and nonappelable.  He discussed four issues that come up frequently in these arbitrations:

(a) Rate cap—the hourly rate paid to Cumis counsel can

be no more than the hourly rate paid to panel counsel

for defending like cases.  He noted that the burden of proof is on the carrier,

and that many carriers fail to come forward with competent evidence.  (He also suggested that the noncarrier interests in the arbitration pick an arbitrator who will enforce procedural and burden of proof rules.)

(b) Hours billed—whether the work related to

covered versus uncovered claims, with the

carrier having to make a Buss allocation if it

challenges the work on this basis.

(c) Fees spent on cross-complaint or third-party complaint—

Claimant needs to show the offensive actions

had defensive purposes or involved common law/facts.

d) Carrier billing guidelines—arbitrator must decide if the

guidelines are enforceable. Usually, if

guidelines are sent later into the case, they are

only enforced prospectively.

The guidelines will not be enforced where they unnecessarily

shackle the Cumis attorney’s decisionmaking or discretion to

litigate effectively. Arbitrators usually rule that

carriers cannot unreasonably withhold consent to

attorney actions under the guidelines.

·         Mr. Moscaret ended by noting that carriers usually settle most of

the Cumis arbitrations well before adjudication.