United States v. Mitchell

          MEMORANDUM OPINION

          ROYCE C. LAMBERTH UNITED STATES DISTRICT COURT JUDGE

         Plaintiffs Motion for Reasonable Expenses, Attorneys' Fees, and Costs (ECF No. 77) arises out of a 2014 False Claims Act ("FCA") suit that Dr. Brian Foley filed against Dr. John Mitchell, The Heart Center Cardiology ("THC"), and East Alabama Medical Center ("EAMC"). The underlying lawsuit alleged that Dr. Mitchell was falsifying medical records and performing unnecessary heart stent procedures. That suit resulted in a settlement pursuant to the terms of which Dr. Mitchell and THC paid $35, 000. EAMC-the hospital at which Dr. Mitchell practiced-settled for $1, 000, 000. Counsel for EAMC paid relator's attorneys' fees ($98, 905.21) and expenses ($5, 375.78). Relator now seeks reimbursement from Dr. Mitchell and THC for attorneys' fees in the amount of $19, 269.60 and reimbursement for expenses in the amount of $832.94. He asks for a total of $20, 102.54. Dr. Mitchell and THC have refused to pay and believe that the requested amount is not proportional to the result. For the reasons set forth below, the Court will grant in part and deny in part relator's motion.

         LEGAL STANDARD

         The FCA allows a qui tarn relator like Dr. Foley to "receive an amount for reasonable expenses which the court finds to have been necessarily incurred, plus reasonable attorneys' fees and costs." 31 U.S.C. § 3730(d)(1). The FCA further states that "[a]ll such expenses, fees, and costs shall be awarded against the defendant." Id. In determining the amount to be paid, "[t]here is no precise rule or formula." Hensley v. Eckerhart, 461 U.S. 424, 436 (1983). The Court has discretion when determining what amount is reasonable. See Gray v. Lockheed Aeronautical Sys. Co., 125 F.3d 1387, 1389 (11th Cir. 1997). Courts generally calculate attorneys' fees under the lodestar formula, meaning "the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate."^[1] Hensley, 461 U.S. at 433. When analyzing a reasonable hourly rate, courts look at "the prevailing market rate in the relevant legal community for similar services by lawyers of reasonably comparable skills, experience, and reputation." Norman v. Hous. Auth. of Montgomery, 836 F.2d 1292, 1299 (11th Cir. 1988). The "relevant market" is usually the "place where the case is filed." Cullens v. Ga. Dep 't of Transp., 29 F.3d 1489, 1494 (1 lth Cir. 1994). Litigants have no duty to select "the nearest and cheapest attorney" in order to win expenses and fees. Johnson v. Univ. Coll. of Univ. of Ala. in Birmingham, 706 F.2d 1205, 1208 (1 lth Cir. 1983). A reasonable fee is one that is "sufficient to induce a capable attorney to undertake the representation of a meritorious ... case." Perdue v. Kenny A. ex rel. Winn, 559 US. 542, 552(2010).

         Although the lodestar method is the primary formula for calculating expenses and fees, courts may adjust the formula to account for other factors. See Hensley, 461 U.S. at 434. In the Eleventh Circuit, courts also reduce the amount awarded in cases that resulted in only partial or limited success. See Norman, 836 F.2d at 1302. In addition to being reasonable, the fee breakdown must also be specific and detailed rather than vague or cursory. Awarding fees and expenses is an area in which courts inherently have a great deal of discretion, so the Court must focus on what amount is reasonable under the totality of the circumstances.

         ANALYSIS

         In this case, relator seeks reimbursement for attorneys' fees in the amount of $19, 269.60 and reimbursement for expenses in the amount of $832.94 for a total of $20, 102.54. As explained below, the Court finds that relator did prevail to some extent and that the hourly rate and time spent on the case were both reasonable; however, because relator was not entirely successful, the $20, 102.54 will be reduced to $8, 041.02.

         I. The Requested Attorneys' Fees are Reasonable.

         When assessing fees under the lodestar method, both the hours worked and the rate charged must be reasonable. Here, both lodestar components were reasonable.

         A. The Reported Hours were Reasonable.

         The hours reported are comprised of work directly attributable to the claims against Dr. Mitchell and THC along with some expenses and fees common to Dr. Mitchell, THC, and EAMC. When Dr. Foley settled the costs and fees claim with EAMC, he removed any time solely attributable to work related to Dr. Mitchell and THC. Most courts hold that defendants are jointly and severally liable for fees and expenses, though in this case relator attempted to allocate the fees and expenses to the party related to the corresponding work rather than collecting all or any portion from one defendant. In light of the difficulty of the case, the hours expended were reasonable, as FCA claims are inherently complex. Additionally, the attorneys kept meticulous time logs and billing descriptions and have reported their hours with the requisite specificity. The logs in ECF 78-7 are concrete and specific rather than vague or cursory, with each entry describing a specific task. Similarly, ECF 78-10 breaks down the expenses for working on the case rather than simply estimating an amount. It is also worth noting that Dr. Mitchell's Response and Objection to Relator's Motion for Reasonable Expenses, Attorneys' Fees, and Costs does not even meaningfully dispute that the hours expended were reasonable.^[2] ECF No. 81-1. For these reasons, there is no need for any reduction on the basis of vague'or generic billing practices. There is also no issue with the fact that more than one attorney worked on the case, as that is common practice with FCA claims.

         B. The Reported Rate was Reasonable.

         The hourly rates charged by the attorneys are reasonable. The attorneys in this case have reputations for being successful in FCA cases. They also submitted affidavits explaining their backgrounds, credentials, and work in this case. Contrary to defendants' assertions, courts do consider attorneys' backgrounds and resumes in deciding whether a fee is reasonable; to disregard such information would be illogical, as clients choose attorneys based on their reputations, and fees are generally established at the beginning of the attorney-clientrelationship. Defendants do not even attempt to meaningfully contest the attorneys' past successes, asking the Court to focus instead on the attorneys' supposed lack of success in this case. As explained below, however, the Court strongly disagrees with defendants' contention that relator did not prevail to any extent. Additionally, the reasonableness of a fee does not necessarily hinge on the outcome of the case. When a client selects an attorney and agrees to pay a certain hourly rate, he is bound by that hourly rate (barring exceptional circumstances). He does not get to claim that the fee he agreed to is suddenly unreasonable simply because he lost his case. The same principle applies here. With that principle and the available information about relator's attorneys in mind, the Court finds that the hourly rates for all four attorneys were reasonable.

         Looking first at Don McKenna, he has repeatedly been recognized for his work in both regional and national publications. He has been involved with FCA work since 1997 and won recoveries totaling more than $1.6 billion. Additionally, he has given speeches and lectures on the FCA throughout the country. The Court finds that Mr. McKenna's rate of $510 per hour in 2014 and $525 for all subsequent years was reasonable. Turning next to Scott Powell, he is a senior partner at Hare, Wynn, Newell & Newton, LLP. He has been involved with FCA cases and the qui tarn provisions of the Act since the mid-1990s and has won some of the most significant monetary awards in FCA history for his clients. He is involved with groups dedicated to fighting fraud and has served as the President of numerous prestigious legal organizations. The Court finds that Mr. Powell's rate of $650 per hour was reasonable. As for Randi McCoy, she has worked on numerous FCA cases. She joined Hare, Wynn, Newell & Newton, LLP in 2015 and has been practicing exclusively in the area of the FCA ever since. The Court finds that her initial hourly rate of $125 was reasonable, as was the increase to $150 once she gained more experience in FCA litigation. Finally, Jonathan Corley has been a partner at Whittelsey, Whittelsey, Poole & Corley, P.C. since 2014. Although he does not have an FCA-specific background, he has ...