Opinion
CIVIL ACTION No. 00-2069-KHV
October 18, 2001
MEMORANDUM AND ORDER
On August 10, 2001, the Court entered an order which partially sustained plaintiff's motion to approve attorneys fees and expenses under K.S.A. § 7-121b. See Memorandum And Order (Doc. #127). This matter comes before the Court on plaintiff's Motion For Reconsideration And For Additional Hearing To Supplement The Record ("Motion For Reconsideration") (Doc. #130) filed August 24, 2001. For reasons stated below, plaintiff's motion is sustained in part.
Legal Standards
The Court has discretion whether to grant a motion to reconsider. See Hancock v. City of Okla. City, 857 F.2d 1394, 1395 (10th Cir. 1988). The Court may recognize any one of three grounds justifying reconsideration: an intervening change in controlling law, availability of new evidence, or the need to correct clear error or prevent manifest injustice. See Major v. Benton, 647 F.2d 110, 112 (10th Cir. 1981); Burnett v. Western Resources, Inc., 929 F. Supp. 1349, 1360 (D. Kan. 1996). A motion to reconsider is not a second opportunity for the losing party to make its strongest case, to rehash arguments, or to dress up arguments that previously failed. See Voelkel v. Gen. Motors Corp., 846 F. Supp. 1482, 1483 (D. Kan.), aff'd, 43 F.3d 1484, 1994 WL 708220 (10th Cir. 1994). Such motions are not appropriate if the movant only wants the Court to revisit issues already addressed or to hear new arguments or supporting facts that could have been presented originally. See Van Skiver v. United States, 952 F.2d 1241, 1243 (10th Cir. 1991).
Analysis
I. Attorneys Fees
In its previous order, the Court found that the lodestar analysis was appropriate to determine reasonable attorneys fees in this case. See Memorandum and Order (Doc. #127) at 5-4. Because counsel did not keep contemporaneous time records and relied on post-hearing time records that were not credible, the Court looked to the number of hours billed by defense counsel. See id. at 6-7. Plaintiff argues that the hours billed by defense counsel are irrelevant under Evans v. Provident Life Acc. Ins. Co., 249 Kan. 248, 815 P.2d 550 (1991). Evans, however, does not prohibit the Court from comparing the fees of defense counsel in this case. Evans involved K.S.A. § 40-256, which permits a plaintiff to recover reasonable attorneys fees if an insurance company refuses to pay a claim without just cause or excuse. See id. 249 Kan. at 261-62, 815 P.2d at 560-61. The Kansas Supreme Court found that the trial court had not abused its discretion in denying discovery on fees incurred by defense counsel, where plaintiff had not shown a correlation between the fees which each side had incurred. See id. 249 Kan. at 265, 815 P.2d at 563. It also found that plaintiff had presented expert testimony on attorneys fees and was not prejudiced by the trial court's refusal to permit discovery. See id. Moreover, plaintiff in Evans apparently kept contemporaneous time records which were available to the court. See id. 249 Kan. at 263, 815 P.2d at 562 (noting that trial court awarded fees at rate of $85.00 per hour for 842.89 hours).
In making this determination, the Court found that counsel's 50 per cent contingency fee agreement with plaintiff was "inarguably excessive."Memorandum and Order (Doc. #127) at 5-4. Plaintiff asserts that at the evidentiary hearing counsel reduced to 45 per cent the 50 per cent the contingency fee requested in his initial brief. See Motion For Reconsideration at 2-3. In his post-hearing brief, however, plaintiff continues to request 50 per cent of the settlement recovery. See Plaintiff's Supplemental Memorandum In Support Of Plaintiff's Motion For Approval Of Attorneys' Fees And Expenses (Doc. #126) filed May 7, 2001. In any event, the Court finds that a 45 per cent contingent fee also would be excessive.
The Court acknowledges that the time spent by defense counsel is not a perfect measure of the time spent by plaintiff's counsel. Nevertheless, it is the best analogy available in the circumstances of this case. See,e.g., Ruiz v. Estelle, 553 F. Supp. 567, 584 (S.D. Tex. 1982) (comparing amount of time spent by defense counsel in prison litigation to determine whether time claimed by plaintiff's counsel was reasonable). The Court agrees with the analysis set forth in Ruiz:
By definition, the parties involved were litigating the same issues. The time spent by defendants' attorneys in defending an action necessarily relates to the time spent by plaintiffs, though the relation is obviously imprecise, and may be governed by a variety of factors. Federal courts have repeatedly noted the value of information concerning the defendants' counsel's time expenditure, in assessing the reasonableness of time claimed by plaintiffs. . . . Though an assumption of precise congruity between the amounts of time spent by the two parties would obviously not be warranted, the value of the comparison cannot reasonably be assailed.553 F. Supp. at 584 (citations omitted). While such a comparison may not be appropriate in every case see, e.g., Burks v. Siemens Energy Automation, Inc., 215 F.3d 880, 884 (8th Cir. 2000) (rejecting argument that district court should have compared fees awarded to plaintiff's counsel with fees charged by defendant's attorneys), it is the most appropriate measure available here, where counsel did not keep any contemporaneous records. See, e.g., Bergeson v. Dilworth, 875 F. Supp. 733, 737 (D. Kan. 1995) (attorneys who work on contingent fee basis should keep time records).
In its previous order, the Court reduced by two-thirds the hours claimed by plaintiff's counsel, based on the time spent by Thomas M. Sutherland, counsel for individual doctor defendants John A. Holmes, M.D. and Firmin Snodell, M.D., who billed 418.55 attorney and paralegal hours in the case. The Court has since examined the billing records of counsel for Shawnee Mission Medical Center ("SMMC") and individual nurse defendants Pennie Messmer, Erin Schmidt, John Mundy, Rosemary Mullen and Nadine Paegel, who spent 290.6 attorney and paralegal hours in the case. Upon further reflection, the Court will include in its estimate of reasonable hours for plaintiff the time incurred by both defense counsel. Undoubtedly, some of this time represents duplicate efforts, such as preparing answers and attending depositions. Nevertheless, defense counsel also spent time on factual and legal issues which differed as to each defendant. Rather than attempting to make micro-distinctions with regard to each defendant, the Court will approve reasonable attorneys fees for plaintiff based on the total number of hours billed by both defense counsel. Defense counsel spent a total of 709.15 hours on the case, which is close to 50 per cent of the 1,423.5 hours claimed by plaintiff The Court will therefore reduce by 50 per cent the hours claimed by plaintiff. See, e.g., Jane L. v. Bangerter, 61 F.3d 1505, 1510 (10th Cir. 1995) (court did not abuse discretion in reducing attorneys fees by 35 per cent because counsel kept sloppy and imprecise time records); Von Clark v. Butler, 916 F.2d 255, 259-60 (5th Cir. 1990) (affirming more than 60 per cent reduction in fee request where counsel did not keep adequate time records on prevailing claim);Broadcast Music, Inc. v. R Bar of Manhattan, Inc., 919 F. Supp. 656, 661 (S.D.N.Y. 1996) (lack of contemporaneous time records warranted 50 per cent fee reduction).
In the final days of the case, Todd A. Scharnhorst entered his appearance for Dr. Holmes because Mr. Sutherland experienced a potential conflict of interest. Mr. Scharnhorst's hours duplicate those spent by Mr. Sutherland on behalf of Dr. Snodell, so the Court has not included them in this analysis.
To the extent duplicative time is included, it may help compensate plaintiff for time spent preparing the case before it was filed.
The Court re-calculates the lodestar as follows:
Attorney/ Requested Allowed Hourly TotalParalegal Hours Hours Rate Amount
The Court has determined the allowed hours by multiplying the requested hours by .50.
Ronald Stites 187.2 93.6 $165.00 $15,444.00
Elizabeth Diane Baker 122.1 61.05 $145.00 $ 8,852.25
Carol A. Lindgren-Bron 581.3 290.65 $120.00 $34,878.00
David A. Hoffman 86.4 43.2 $150.00 $ 6,480.00
Dawn R. Laderoute 194.8 97.4 $ 60.00 $ 5,844.00
Trish A. Farris 54.1 27.05 $ 60.00 $ 1,623.00
Joyce L. Garrison 14.8 7.4 $ 50.00 $ 370.00
Tonia E. Chambers 157.9 78.95 $ 50.00 $ 3,947.50
Suzie L. Miller 24.9 12.45 $ 25.00 $ 311.25 ________ ________ ___________
TOTAL 1,423.5 711.75 $77,750.00 ________ _________ ___________ ________ _________ ___________
Plaintiff asserts that the Court did not properly analyze the factors enumerated under K.S.A. § 7-121b. The Court did not expressly discuss each factor; its analysis, however, implicitly incorporates them. See,e.g., Gudenkauf v. Stauffer Comm., Inc., 158 F.3d 1074, 1083 (10th Cir. 1998) (district court need not specifically address each Johnson factor). Regardless, the Court will discuss them here to avoid any confusion. The first factor involves the time and labor required, the novelty and difficulty of the questions involved and the skill requisite to perform the legal service properly. These considerations are included in the Court's lodestar calculation. In particular, the hourly rate reflects the requisite skill level, and the amount of time compensates for the novelty and difficulty of the questions involved. The Court rejects counsel's self-serving statements that the issues presented were particularly novel or difficult to warrant an upward adjustment of the lodestar.
Plaintiff asserts that the affidavit of Michael L. Sexton, a local medical malpractice attorney, addressed the time, labor, difficulty and novelty of the case. See Motion For Reconsideration at 3-4. The affidavit states that "the time and labor required was substantial" and that it appears that "counsel performed the legal service properly and with skill." Affidavit at ¶ 5, Exhibit F to Plaintiff's Supplemental Memorandum In Support Of Plaintiff's Motion For Approval Of Attorneys' Fees And Expenses (Doc. #126) filed May 7, 2001 at 4. It does not address the difficulty or novelty of the case. See id.
The second and fifth factors are the likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the attorney and the time limitations imposed by the client or by the circumstances. Plaintiff argues that one attorney left another trial in November 2001 to meet the discovery deadlines in this case and that three attorneys spent the vast majority of their time on this case beginning in January 2001 to March or April 2001. The discovery deadlines in this case, however, were not atypical. Any preclusion of work in other cases was in line with what is expected in the ordinary practice of law.
The settlement hearing was held on April 23, 2001. It appears that the parties reached settlement in March or April 2001.
The third and eighth factors are the fee customarily charged in the locality for similar legal services and whether the fee is fixed or contingent. Plaintiff presented evidence that a 45 per cent contingency fee is customarily charged in this area for medical malpractice cases. While plaintiff's agreement with counsel is some evidence of the value of counsel's services, it is not the sole criterion. See Farmco, Inc. v. Explosive Specialists, Inc., 684 P.2d 436, 444 (Kan.App. 1984) (determining attorneys fees in garnishment case, using same factors as K.S.A. § 7-121b). Rather, the reasonable value of the services rests with the Court, which is "in a position to weigh the skill, experience, reputation and ability of the lawyers performing the services." Id. The trial judge is an expert in this area and may draw upon her own knowledge and expertise in making this evaluation. See id. Regardless of any contingency agreement, the Court has an independent duty to determine whether the attorneys fees are reasonable. See Bhattacharya v. Copple, 898 F.2d 766, 769 (10th Cir. 1990); see also Samsel v. Wheeler Transp, Servs., Inc., 246 Kan. 336, 339, 789 P.2d 541, 545 (Kan. 1990) (K.S.A. § 7-121b enacted to control rising costs of medical malpractice premiums). In the circumstances of this case, the Court has determined that a lodestar analysis better reflects a reasonable fee. See, e.g., Beck v. Northern Nat. Gas Co., 170 F.3d 1018, 1025 (10th Cir. 1999) (affirming district court decision to reject contingency fee contract and award reasonable attorneys fees to landowners under K.S.A. § 55-1210(c)(3) given likelihood of success, absence of showing that counsel was precluded from other employment and lack of unique time limitations in case); Bergeson, 875 F. Supp. at 739-740 (rejecting excessive contingent fee and using lodestar method to determine reasonable attorneys fees in garnishment action against liability insurer under Kansas law).
The fourth factor is the amount involved and the results obtained. Counsel achieved a positive result for plaintiff, and the lodestar calculation reasonably compensates them for their work on the case.
The sixth factor is the nature and length of the professional relationship with the client. This is the only case in which counsel have represented plaintiff
The seventh factor is the experience, reputation and ability of the attorneys performing the services. Plaintiff was represented by skilled and reputable counsel. The Court considered these factors in setting the hourly fees.
Plaintiff asserts that the Court has improperly relied on federal law in violation of Erie R.R. Co. v. Tompkins, 304 U.S. 64 (1938). See Supplemental Suggestions In Support Of Plaintiff's Motion For Reconsideration And For Additional Hearing To Supplement The Record ("Supplemental Suggestions") (Doc. #133) filed September 7, 2001 at 1-3. The Court disagrees. The Court has applied the standards articulated by the Kansas legislature and Kansas courts for determining reasonable attorneys fees. With respect to issues which Kansas courts have not addressed, the Court believes they would look to the federal cases which the Court has cited. See Vanover v. Cook, 260 F.3d 1182, 1186 (10th Cir. 2001) (in absence of definitive direction from highest state court, federal court must "predict the course that body would take if confronted with the issue.") (quoting Carl v. City of Overland Park, Kan., 65 F.3d 866, 872 (10th Cir. 1995). Plaintiff cites no authority to the contrary.
Finally, plaintiff argues that the Court does not have subject matter jurisdiction because the journal entry on April 23, 2001 did not expressly reserve the issue of attorneys fees for further ruling. See Supplemental Suggestions at 3-5. In support of this argument, plaintiff cites Morris v. City of Hobart, 39 F.3d 1105, 1115 (10th Cir. 1994), which involved a court's jurisdiction to enforce a settlement agreement after the case was dismissed. Plaintiff cites no authority which suggests that the Court cannot approve attorneys fees after the case has been dismissed. The Court is aware of none. See e.g., Lancaster v. Indep. Sch. Dist. No. 5, 149 F.3d 1228, 1237 (10th Cir. 1998) (district court retains jurisdiction over awarding attorneys fees as sanctions under Rule 37, Fed.R.Civ.P., after judgment entered and district court retains jurisdiction over collateral matters such as attorneys fees after filing notice of appeal).
II. Expenses
Plaintiff's original motion asked the Court to approve expenses totaling $64,243.87. Counsel provided no documentation, however, to substantiate the reasonableness of the expenses. In the motion for reconsideration, counsel includes approximately two hundred pages of invoices and bills to substantiate its claim for expenses. See Motion For Reconsideration at 6. Pursuant to the Court's request, see Order (Doc. #132) filed September 6, 2001, counsel filed an affidavit which summarizes each category of expenses, organizes the supporting documentation by category and explains why the expenses were reasonably incurred in the litigation. See Affidavit Of Ronald J. Stites Pursuant To Order Of September 6, 2001 Submitted In Camera ("Stites Affidavit I") (Doc. #139) filed September 18, 2001; and Supplemental Affidavit Of Ronald J. Stites. Submitted In Camera ("Stites Affidavit II") (Doc. #145) filed September 21, 2001. While counsel could have provided this information in the first instance, the Court will nevertheless approve the expenses. The Court therefore approves reasonable expenses in the following amounts:
Plaintiff has withdrawn his claim for probate expenses of $2,585.00.
Many of the amounts claimed in counsel's affidavit do not match the total amounts stated on the summaries for each category of expenses.Compare, e.g., Stites Affidavit I at 2, ¶ 4 (stating that counsel spent $1,866.17 to obtain medical records) with Exhibit 1 to Stites Affidavit I ($2,029.01 spent on medical records). In approving the expenses herein, the Court relies on the total amounts stated in the summaries for each category of expenses. The Court has not included long distance charges of $20.50 because counsel did not provide supporting documentation for this claim.
Based on the evidence presented at the hearing on April 23, 2001, consistent with governing statutes and case law, the Court could have summarily denied counsel's motion to approve its attorneys fees and expenses. Similarly, based on the limited evidence presented in counsel's motion for reconsideration, the Court could have summarily withheld its approval of the claimed expenses. The proceedings in this matter should not be misconstrued as a signal that in future cases, the Court will commit limited judicial resources to an effort to coax counsel to substantiate their claims for attorneys fees and expenses. The purpose of a hearing under K.S.A. § 7-121b is for counsel to present all relevant evidence which bears on this issue. Post-hearing evidentiary submissions should be entirely unnecessary, absent unforeseeable issues which arise during the hearing. Counsel therefore should not expect multiple opportunities to substantiate their claims.
Medical Records $ 2,029.02 Filing Fees 269.00 Photocopies and Reproduction 7,885.92 Delivery Charges 382.01 Court Reporting 6,306.11 Mileage and Travel 1,989.20 Expert Fees 43,227.98 Mediation 468.13 _________________ $62,557.37 _________________
Plaintiff requested copying expenses of $9,331.91; however, counsel only provided documentation for $7,885.92. See Stites Affidavit I at 11-12, ¶ 8 (referring to documentation in Exhibit 4 supporting $6,822.90 for out-source charges); Stites Affidavit II at 2, ¶ 4 (referring to documentation in Exhibit 3 supporting $1,063.02 for in-house charges).
Plaintiff claims two amounts for mileage and travel expenses: $962.85 in Stites Affidavit I (Exhibit 6) and $1,196.85 in Stites Affidavit II (Exhibits 1 and 2). It appears that both affidavits include $170.50 in airfare to attend Dr. Oldham's deposition, so the Court deducts $170.50 from the total amount and allows $1,989.20 ($2,159.70-$170.50=$1,989.20).
III. Rehearing
Plaintiff requests a rehearing to present additional documentation to support expenses and testimony from other attorneys regarding the factors listed in K.S.A. § 7-121b. See Motion For Reconsideration at 1, 3 and 6. As discussed above, the Court approves plaintiff's expenses. Since the initial evidentiary hearing, plaintiff has had two opportunities to present affidavit testimony from other lawyers. The Court finds that an additional hearing is unnecessary.
IT IS THEREFORE ORDERED that plaintiff's Motion For Reconsideration And For Additional Hearing To Supplement The Record (Doc. #130) filed August 24, 2001 be and hereby is SUSTAINED in part and OVERRULED in part. The Court approves reasonable attorneys fees in the amount of $77,750.00 and reasonable expenses in the amount of $62,557.37.