A recent 9th Circuit case entitled Welch v. Metropolitan Life Insurance Company offers some insight as to how to avoid getting your fees slashed in U.S. District Court. In Welch, an ERISA case in which the plaintiff prevailed and was awarded attorney's fees, the trial court reduced the plaintiff's fee application by 20%, across the board, to account for the plaintiff's firm's block-billing practices, and another 20%, across the board, to account for billing in increments of quarter-hours. The court also disallowed portions of time spent on memos, office conferences and fee applications, reducing the total amount of time from 98.5 hours to 43.05 hours. The court also cut the hourly rate from $400 to $250.
Justice Ray Fisher affirmed part of the trial court's order that drastically reduced the amount of fees from the requested sum, but reversed two portions of the trial court order, finding that the plaintiff's counsel had adequately established that $375 to $400 was a reasonable hour rate and that reducing the rate to $250 was arbitrary and an abuse of discretion, and that the 20% reduction for block billing was also inappropriate.
We were somewhat amazed that the plaintiff's counsel billed less than 100 hours and still litigated a federal case to a successful resolution in six months. In more than a decade of representing employees, we've tried a case to verdict in less than 100 billable hours exactly once, and that was a case that involved no depositions, four trial exhibits, and just a two day jury trial. Yet, the trial court cut the plaintiff's fees by more than half. For the most part, those cuts were upheld.
Some of the lessons to be drawn from the case:
- Avoid block billing, where you list all the tasks you performed, and then put down a large amount of time for all of the items as a group. Instead, itemize every task and give each an allocation of time.
- Do not bill in quarter hours unit. Use tenths of any hour. For some reason, courts seem to find a billing entry of .25 to be excessive if the task seems simple, but an entry of .30 rarely fails the smell test.
- Don't expect to be paid for inter-office conferences between lawyers in the firm unless there is a very good explanation for it. Granted, the greatest accomplishments of the President of the United States are usually achieved through meetings with advisors and discussions of strategy and the execution of well-devised plans, but the President doesn't have to account for his time to a judge.
- Don't bill your fee application with a heavy pencil.
- Persuade your trial court judge, because the Court of Appeal will show great deference to his or her determinations about how many hours you should have worked.
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