Pursuant to Section 28 (33 U.S.C.S. § 928) of LHWCA (31 U.S.C.S. § 901 et seq.), attorney's fees may be assessed against the employer, the claimant, or not at all. If fees are assessed, the factors to be considered are first the so–called "lodestar" (hourly rate times hours expended), see Hensley v. Eckerhart, 461 U.S. 424, 76 L. Ed. 2d 40, 103
S. Ct. 1933 (1983), and then others.
The other factors are numerous. Some are set out in 20 CFR § 702.132(a), namely (1) the quality of the representation; (2) the complexity of the legal issues involved; and (3) the amount of the benefits obtained. When the fee is assessed against the claimant, the tribunal must also take into account the financial circumstances of the claimant. The regulation applicable to practice before the Benefits Review Board adds the provision that a "fee shall not necessarily be computed by multiplying time devoted to work by an hourly rate." 20 CFR § 802.203(e).
Still other factors have been held to be relevant in federal fee-shifting jurisprudence. They include preclusion of other employment by acceptance of the case; the customary fee; the undesirability of the case; and others. See, e.g., Van Gerwen v. Guarantee Mutual Life Co., 214 F.3d 1041, 1045 (9th Cir. 2000); Spellan v. Board of Education for Dist. 111, 59 F.3d 642, 645 (7th Cir. 1995); Johnson v. Georgia Highway Express, Inc., 488 F.2d 714, 717-719 (5th Cir. 1974).
In the context of civil right actions, the Supreme Court has held that "reasonable fees" are to be calculated in accordance with prevailing market rates in the relevant community. Blum v. Stenson, 465 U.S. 886, 895, 79 L. Ed. 2d 891, 900, 104
S. Ct. 1541, 1547 (1984). The burden of producing evidence of relevant market rate is on the applicant.
Id.; see also Van Skike v. Director, OWCP, 557 F.3d 1041, 1046 (9th Cir. 2009).
But in the context of the LHWCA, is the "relevant" community a geographic community? Is it the community of longshore practitioners? Something else? Some courts have in other contexts defined relevant community as the forum in which the district court sits. See Barjon v.
Dalton, 132 F.3d 496, 500 (9th Cir. 1997). In the LHWCA context, the U.S. Court of Appeals, Fourth Circuit circumscribed the community by referencing what ALJs and the BRB had awarded practitioners in the same geographic region. Newport News Shipbuilding & Dry Dock Co. v. Brown, 376 F.3d 245, 252, 38 BRBS 37(CRT) (4th Cir. 2004).
The Ninth Circuit, however, recently rejected that approach in two cases, adopting instead a standard that is referenced to fees counsel could obtain by taking other types of cases. Christensen v. Stevedoring Services of America, 557 F.3d 1049, 1053-1054 (9th Cir. 2009), citing Camacho v. Bridgeport Financial, Inc., 523 F.3d 973, 979-980 (9th Cir. 2008); Van Skike v. Director, supra.
The court in the Christensen case invited the BRB to look to "market rates," or rates determined by supply and demand for the attorney's time, rather than self-referentially looking to awards in earlier cases.
In Van Skike, the District Director had reduced the hourly rate because of a perceived lack of complexity or novelty of the issues. Again citing Blum, the Ninth Circuit rejected such a reduction as a deviation from the lodestar approach, saying the novelty and complexity of the issues are presumed instead to be reflected in the reasonable number of billable hours approved. Van Skike, 557 F.3d at 1048.
In Mathur v. Board of Trustees of Southern Illinois University, 317 F.3d 738, 743-745 (7th Cir. 2003), the court said that, in the context of an employment discrimination case, a party must make a good-faith effort to find local counsel before seeking counsel elsewhere, in order to have non-local counsel compensated at non-local rates. The question arises whether this same standard would apply in LHWCA and related cases, since in many areas of the country there are no experienced or knowledgeable practitioners.
Many of these issues faced the court in Jeffboat, LLC v. Director, OWCP (Furrow), 553 F.3d 487, 42 BRBS 65(CRT) (7th Cir. 2009). The claimant had hired experienced LHWCA counsel from Connecticut, after bringing his hearing loss claim in his place of employment, in
Indiana. The court first noted that, in accordance with Seventh Circuit law, the claimant's attorney had invoked a presumption of reasonableness of the hourly rate by demonstrating the rate was the same as that charged other clients for similar work. Since it was higher than the
Indiana rate, however, Jeffboat argued claimant must show he attempted to find local counsel before going elsewhere.
In rejecting Jeffboat's arguments, the Seventh Circuit noted that "community" could just as well refer to a community of practitioners as a local market area, especially where the subject matter is highly specialized, and the market for such legal services is a national one. It left to the lower court's discretion whether to lower the hourly rate of an out-of-town attorney to accord with local rates.
These cases highlight the care with which a practitioner should approach the crafting of a fee request. In the Jeffboat case, counsel attached to the fee request a previous LHWCA case decided in the Indiana area, as well as surveys and publications aimed at establishing billing rates for partners in
Connecticut. In Van Skike, counsel relied on his own affidavit regarding his experience and fee awards in other cases, but included in it information from a consultation with a fee expert attorney. It would seem reasonable to include in the fee request information about fee awards in recent cases handled by the practitioner; about fee awards to others in the geographic area where the case is filed and heard; and about reasonable billing rates for practitioners similar to the applicant, and practicing in the same geographic area.
© Copyright 2009 Matthew Bender & Company, Inc., a member of the LexisNexis Group All rights reserved. This article by Stephen M. Vaughan, Tucker, Vaughan, Gardner & Barnes, P.C.,
Houston, Texas, will be published in an upcoming issue of the Benefits Review Board Service Longshore Reporter (LexisNexis).