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Litigating Attorney Fee Claims Practical and Ethical Issues March 27, 2018

Litigating Attorney Fee Claims Practical and Ethical Issues March 27, 2018. TODAY’S PRESENTATION. Early assessment r e f ee c laims Ethical issues in fee c laim l itigation Practical considerations in fee c laim litigation Questions/Discussion. WHY?.

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Litigating Attorney Fee Claims Practical and Ethical Issues March 27, 2018

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  1. Litigating Attorney Fee ClaimsPractical and Ethical IssuesMarch 27, 2018

  2. TODAY’S PRESENTATION • Early assessment re fee claims • Ethical issues in fee claim litigation • Practical considerations in fee claim litigation • Questions/Discussion

  3. WHY? • Over 100 Federal statutes provide for an attorney’s fee award • State statutes also a basis for making a fee claim • Private Attorney General Statutes • Unfair Business Practice Statues • Contracts • Prevailing party clauses • Indemnification provisions • InsuranceCoverage Litigation • Recovering costs of defense • Bad faith based fee recovery

  4. TEXAS: CORPORATION V. LLC OR LP • Tex. Civ. Prac. & Rem. Code Ann. § 38.001 • “A person may recover reasonable attorney’s fees from an individual or corporation . . .” • Alta Mesa Holdings, L.P. v. Ives, 488 S.W.3d 438, 452-455 (Tex. App. Houston [14th Dist.] 2016, pet. denied) (no fee recovery from limited liability company) • Choice! Power, L.P. v. Feeley, 501 S.W.3d 199, 214 (Tex. App. Houston [1st Dist.] 2016, no pet.) (no fee recovery from limited partnership)

  5. EARLY CASE ASSESSMENT • Early case assessment re attorney’s fees • Claim often overlooked • When prosecuting a claim • What is the legal basis of claim • What fees/costs are recoverable • What is the cost of prosecution • Is the fee to be recovered reasonable • What is the ROI

  6. EARLY CASE ASSESSMENT • When defending a claim • What is the legal basis • What is the potential exposure • What is the strategy for defeating a fee claim • No basis for an award • Limiting the amount of the award

  7. ETHICAL ISSUES • Fee must be reasonable • ABA Model Rule 1.5 • Texas Rules of Professional Conduct/Arthur Anderson & Co. v. Perry Equip. Corp., 945 S.W. 2d 812 (Tex. 1997)

  8. ETHICAL ISSUES • Factors • The time and labor required • The novelty of the issues • The skill required • Does acceptance of the matter preclude accepting other engagements • Fee customarily charged in the locality of similar services

  9. ETHICAL ISSUES • Additional Factors • The amount involved and results obtained • Time limitations imposed by the client or circumstances • The nature and length of the professional relationship with client • The experience, reputation and ability of the lawyers • Type of fee (fixed; contingent etc.) • Proper staffing—appropriate levels of experience and competency • Conflicts • Independent counsel

  10. ETHICAL ISSUES • Disclosure Issues Model Rule: • When Prosecuting a claim--Disclosure required re reasonableness • Informed consent requirement re attorney testifying • Right to independent counsel disclosure • Privilege issues

  11. ETHICAL ISSUES • Specific Examples • Lawyer as a witness • No conflicts of interest • Issues regarding staffing (competency; experience) • Management of non-attorney staff • Discovery disputes, Model Rules 3.1/3.4 • Alternative fee arrangements (flat fee/fixed fee/contingent fee hybrids)

  12. Impacton Privilege • In re Nat’l Lloyds Ins. Co., 532 S.W.3d 794 (Tex. 2017) • As a whole, billing records are work product. • We acknowledge that an opposing party may waive its work-product privilege through offensive use–perhaps by relying on its billing records to contest the reasonableness of opposing counsel’s attorney fees or to recover its own attorney fees.

  13. PRACTICAL CONSIDERATIONS • Who is the decision maker • Know your audience (Judge/Jury/Arbitrator) • When do judges vs. juries decide fee reasonableness • Attorney's-fees-as-compensatory-damages cases • Post-trial prevailing party fee shifting cases

  14. HOW COURTS EVALUATE FEE REASONABLENESS • State Courts vs. Federal Courts: what are the usual standards or criteria? • ABA Rule 1.5 Factors (all 50 states) • Johnson Factors (federal court) • Judges may scrutinize legal bills more closely in fee-shifting cases than attorney's-fees-as-damages cases

  15. SPECIFIC ISSUES FOR FEE LITIGATION • Top 10 billing issues for either a fee claimant expert or fee opponent expert: • Core attorney case staffing • Appropriate mix of core attorneys • Sufficient delegation of work • How much duplication of effort • Junior attorney training time • Purely clerical work and law firm overhead • Block billing • Quarter-hour minimum billing increments • Overly vague time entries • Recycled written work product

  16. Questions?

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