Missouri Court Takes Care of Unhealthy Billing Practices, Reduces Fees by 39%

Posted on November 20th, 2018 by Legal Fee Advisors

By Zachary Kalmbach.

A plethora of billing improprieties led a Missouri federal court to cut a fee request by nearly 40%. In the case, the plaintiffs claimed that certain Missouri healthcare statutes were preempted by the Affordable Care Act. The Court granted summary judgment for plaintiffs, after which plaintiffs sought $513,799.57 in attorneys’ fees. A review of plaintiffs’ billing records revealed unreasonably high hourly rates, charges for excessive, redundant, and clerical work, and vague descriptions of tasks. Accordingly, the Court awarded a reduced fee award of $312,341.30.

First, the Court found that two of plaintiffs’ attorneys billed at hourly rates that were higher than those customarily charged by mid-Missouri attorneys. Plaintiff employed out-of-town attorneys, and the Court found no indication that plaintiff tried to find and had difficulty finding local counsel to take the case. Accordingly, there was no justification for charging higher rates than those charged by attorneys in the locality, and the Court reduced one attorney’s rate from $540 to $390 and another’s from $400 to $360.

The Court also found a number of problems with counsel’s billing practices, such as charges for redundant and excessive work. For example, more than 100 hours spent by four attorneys researching, drafting, revising, discussing, and working on the complaint was excessive and compelled the Court to reduce fees by $22,000. Moreover, the same four attorneys billed over 175 hours researching, drafting, discussing, and editing a single motion for a preliminary injunction. The Court determined that, “due to the redundancy of the work performed, the excessive time spent, and the number of attorneys,” fees should be reduced by an additional $40,000.

Moreover, with regard to other filings in the case, the Court found that “at least three, and as many as four, attorneys conducted research, drafted, and/or edited filings.” Further, in many instances, at least two attorneys billed for the same phone calls and meetings. The Court determined that plaintiffs failed to establish why it was necessary and reasonable for two to four attorneys to perform the same task. Plaintiffs sought recovery for 1,500 hours of work, despite the fact that “no discovery was conducted…no hearing was held, and no trial ever took place.” Due to the additional excessive, unnecessary, and duplicative entries, the Court reduced fees by another $85,000.

The Court further reduced fees billed for clerical tasks. Such tasks included making copies, printing, converting, and saving documents, and composing tables for briefs. The Court estimated that these tasks cost approximately $7,500, and reduced the fee award by that amount.

Finally, the Court found that a number of entries were too vague for the Court to discern on which claim or issue the attorney was spending his or her time. Such entries included descriptions like “compose memos for consumer groups,” “research transacting the business of insurance,” “call with Jane,” “call with plaintiffs,” “work on Missouri 2 pager,” and “searching for caselaw.” The Court estimated that such time resulted in $15,000 in fees, and reduced the fee award accordingly.

In conclusion, the Court found that a reasonable fee award was $312,341.30. This was 39% less than the amount plaintiffs requested. In addition to hourly rates that were too high, the Court also reduced the award on account of a number of improper billing practices, such as; excessive and redundant work, clerical tasks, and described work in terms that were too vague. This case should serve as a guide to attorneys when setting hourly rates and determining the amount and type of work for which clients should be charged. Moreover, the case should remind attorneys that billing records should be kept in a detailed manner such that the Court can ascertain what work attorneys actually performed.

St. Louis Effort For AIDS, et al. v. Lindley-Myers, No. 13-4246-CV-C-ODS, 2018 WL 1528726 (W.D. Mo. Mar. 28, 2018)

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