Opinion
Civil Action No. 3:03-CV-1611-B.
December 27, 2004
MEMORANDUM ORDER
Before the Court are Defendant Ronald Stafford's ("Stafford") Motion for Approval of Second and Final Application for Defendant's Attorney's Fees (the "Motion"), filed November 4, 2004, and Plaintiff Old Republic's ("Old Republic") Request for Adversary Submissions and/or Hearing, filed November 5, 2004. Stafford moves the Court for an award of attorney's fees and expenses against Old Republic in the amount of $85,668.04, plus additional fees for appellate work performed should an appeal be filed. Having reviewed the briefing of the parties related to the Motion and corresponding attachments, the Court finds that the evidence presented in support of Stafford's Motion is insufficient to support the requested award; however, the Court will allow Stafford an opportunity to file supplemental evidence before the Court rules on the Motion. The Court further finds that Old Republic's request for adversary submissions and/or hearing should be GRANTED in part and DENIED in part.
I. Background
The following background facts are undisputed and are gleaned from the Joint Pretrial Order submitted by the parties on October 12, 2004.
Old Republic is the workers' compensation insurance carrier for Roadway Express. Old Republic filed this lawsuit under § 410.251 of the Texas Labor Code, seeking to overturn the Contested Case Hearing and Appeals Panel decisions of the TWCC. A jury trial was held, and on October 15, 2004, the jury found that Stafford had sustained an injury in the course and scope of his employment for Roadway Express on May 2, 2002 and that Stafford had a disability resulting from that injury from May 3, 2002 through May 16, 2002 and from July 14, 2002 through April 17, 2003. Judgment was entered on December 2, 2004. As the prevailing party, Stafford moves for an award of attorney's fees under § 408.221(c) of the Texas Labor Code.
II. Analysis
In diversity cases, state law determines whether a party is entitled to an award of attorney's fees. Atchison, Topeka and Santa Fe Ry. Co. v. Sherwin-Williams Co., 963 F.2d 746, 751 (5th Cir. 1992). Section 408.221(c) of the Texas Labor Code provides that an insurance carrier which seeks judicial review of a final decision of a TWCC Appeals Panel regarding the compensability or eligibility of income benefits is liable for "reasonable and necessary attorney's fees . . . incurred by the claimant as a result of the insurance carrier's appeal if the claimant prevails on an issue on which judicial review is sought by the insurance carrier. . . ." TEX. LABOR CODE § 408.221(c). An attorney's fee is based on the attorney's time and expenses. TEX. LABOR CODE § 408.221(b).
The Court notes that while Stafford's entitlement to attorney's fees is clearly governed by Texas law, it remains unsettled whether federal or state law controls the calculation of reasonable fees. Robinson v. State Farm Fire Cas. Co., 13 F.3d 160, 164 (5th Cir. 1994); Keeton v. Wal-Mart Stores, Inc., 21 F.Supp.2d 653, 656-57 (E.D. Tex. 1998). The Fifth Circuit has sidestepped this issue "because the Texas courts look to many of the same factors as do the federal court in making attorney-fee awards." Robinson, 13 F.3d at 164. Here, as discussed infra, the Texas Labor Code enumerates seven factors to be considered by a court in approving attorney's fees under § 408.221. TEX.LABOR CODE § 408.221(d). Because these factors are largely subsumed within the Johnson factors applied in federal cases, discussed infra, the Court finds that the application of either state or federal law would yield the same results.
The Texas Labor Code provides a number of factors to be considered by a court in approving an attorney's fee, including:
1) the time and labor required;
2) the novelty and difficulty of the questions involved;
3) the skill required to perform the legal services properly;
4) the fee customarily charged in the locality for similar legal services;
5) the amount involved in the controversy;
6) the benefits to the claimant that the attorney is responsible for securing; and
7) the experience and ability of the attorney performing the services.
In awarding statutorily-authorized attorney's fees, district courts in the Fifth Circuit employ a two-step procedure. See Louisiana Power and Light Co. v. Kellstrom, 50 F.3d 319, 323-24 (5th Cir. 1995). First, the reasonable number of hours expended by counsel is multiplied by the reasonable hourly rate charged by lawyers in the community. Id. at 324. The product of this multiplication is the base fee, or "lodestar", which the Court then either accepts or adjusts upward or downward based on twelve factors enunciated in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir. 1974). The Court may modify the lodestar if any of the Johnson factors not already considered in the reasonable fee analysis warrant an adjustment. See Watkins v. Fordice, 7 F.3d 453, 457 (5th Cir. 1993). The lodestar is presumptively reasonable, however, and should be modified only in exceptional cases. Id. (citing City of Burlington v. Dague, 505 U.S. 557, 562 (1992).
The Johnson factors are: (1) the time and labor required; (2) the novelty and difficulty of the case; (3) the skill required; (4) the preclusion of other employment; (5) the customary fee; (6) whether the fee is fixed or contingent; (7) time limitations imposed; (8) the results obtained; (9) the experience, reputation and ability of the attorneys; (10) the undesirability of the case; (11) the nature and length of the professional relationship with the client; and (12) awards in similar cases. Johnson, 488 F.2d at 717-19.
Stafford seeks reimbursement for $85,668.04 in fees for the work of six different lawyers who worked at hourly rates ranging from $350.00 down to $225.00. Old Republic objects to the hourly rates of the six attorneys who represented Stafford, contending that they far exceed the standard fees sought by Dallas lawyers for performing similar work. Reasonable hourly rates are determined by the "prevailing market rates in the relevant community" for similar services by lawyers of comparable skill, experience, and reputation. League of United Latin Am. Citizens #4552 v. Roscoe Indep. Sch. Dist., 119 F.3d 1228, 1234 (5th Cir. 1997); Wheeler v. Mental Health and Mental Retardation Auth. of Harris County, Texas, 752 F.2d 1063, 1073 (5th Cir. 1985). The forum district, here Dallas, Texas, is generally the relevant "market." Hawkins v. Nat'l Ass'n of Sec. Dealers, Inc., 1998 WL 74259, at *1 (N.D. Tex. Feb. 13, 1998). Stafford shoulders the burden of producing satisfactory evidence, in addition to his attorneys' affidavits, that the requested rate is consistent with prevailing market rates. Wheeler, 752 F.2d at 1073; Guidry v. Jen Marine, LLC, 2003 WL 23095590, at *4 (E.D. La. Dec. 24, 2003). "When the attorney's customary hourly rate is within the range of hourly fees in the prevailing market, that rate should be considered in setting a reasonable hourly rate." League, 119 F.3d at 1234.
The Court finds that the evidence submitted by Stafford is insufficient to establish that the hourly rates charged by his attorneys are reasonable. The affidavit of Jeffrey L. Raizner, Stafford's lead trial counsel, simply states Mr. Raizner's "opinion and belief" that the hours expended and hourly rates charged by members of his law firm were reasonable and necessary. (Raizner Aff., App. at 1-2). No basis is established to support that opinion, however. The affidavit of Peter N. Rogers is equally conclusory. (Rogers Aff., App. at 13-14). The Court finds that Byron C. Keeling's affidavit sufficiently lays a predicate for his opinion regarding the reasonableness of the fees charged by his firm. Nevertheless, on the whole, Stafford's evidence fails to set forth sufficient "evidence of rates charged in similar cases by other local attorneys, who possess similar experience, skill and reputation." BB Schiffahrts v. Am. Diesel Ship Repairs, Inc., 2001 WL 406284, at *1 (E.D. La. April, 19, 2001).
The Court notes that despite Mr. Rogers's assertion to the contrary, no time or expense records are attached to his affidavit. (Rogers Aff., App. at 14). The Court further observes that Stafford has not submitted any evidence bearing on Mr. Rogers's educational background and level of experience, particularly with regard to worker's compensation cases.
Stafford attaches to his Motion copies of orders granting fee awards, presumably in worker's compensation cases. Those orders, however, do not indicate the hourly rates charged by the attorneys involved in those cases. While Stafford states that insurance counsel for the Texas Workers' Compensation Insurance Fund sought and received fees based on a $500.00 hourly rate in Ken Pitcock v. Texas Workers' Compensation Insurance Fund, No. 66549, Lamar County, Texas, 62nd Judicial District, the Court notes that the order attached as Ex. H in Stafford's appendix is not signed by the presiding judge. (App. at 45).
Furthermore, Stafford relies on a Texas Lawyer article entitled "Charging More in 2004" to establish that the average billing rate for an equity partner in the Dallas/Fort Worth area is $361.00. Jeanne Graham, Charging More in 2004, TEXAS LAWYER (May 2004), App. at 27). The Court declines to consider this evidence at this time for the following reasons. First, the portions of the article dealing with hourly billing rates of Texas attorneys and the survey methodology are illegible on the copies submitted to the Court. Second, Stafford has made no showing that the average billing rates reported in the article for Dallas/Fort Worth attorneys are customarily charged in worker's compensation cases. Walker v. U.S. Dep't of Housing and Urban Dev., 99 F.3d 761, 770 (5th Cir. 1996) (finding district court's rejection of State Bar of Texas survey was not clear error where the survey did not consider the type of litigation being done).
The Court will allow Stafford another opportunity to present sufficient evidence that the hourly rates charged by his attorneys are consistent with those charged for similar services performed by attorneys of comparable skill, experience and reputation in the Dallas legal community. Stafford is further encouraged to submit any additional evidence which may aid the Court in its application of the Johnson factors and/or the factors delineated in § 408.221(d) of the Texas Labor Code, including evidence concerning: the novelty/complexity of the issues involved, the skill required to perform the work, whether Stafford's attorneys refused work to handle Stafford's representation, the fee customarily charged in the locality for similar legal services, the amount involved in the controversy, and the experience and ability of each attorney performing services for Stafford in worker's compensation law.
III. Conclusion
It is accordingly ORDERED that Stafford present additional evidence in support of his Motion for Approval of Second and Final Application for Defendant's Attorneys' Fees by January 26, 2005. Old Republic may present any rebuttal evidence on or before February 10, 2005. To that extent, Old Republic's Request for Adversary Submissions is GRANTED. Old Republic's Request for Hearing is DENIED.