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United States ex rel. Kirchgessner v. James River Air Conditioning Co.

United States District Court, E.D. Virginia, Richmond Division

February 1, 2019

UNITED STATES OF AMERICA ex rel. NATHAN KIRCHGESSNER, Plaintiffs,
v.
JAMES RIVER AIR CONDITIONING CO., et al., Defendants.

          OPINION

          John A. Gibney Jr. United States District Judge

         This matter comes before the Court on the relator's motion for attorneys' fees and costs. For the reasons that follow, the Court will grant in part the motion and award the relator $110, 735.41.

         I. BACKGROUND

         The relator, Nathan Kirchgessner, filed a case under the False Claims Act ("FCA") against James River Air Conditioning Company ("JRA"). The relator alleged that JRA underpaid workers on government construction projects and falsely certified that JRA paid the workers according to federal laws. The government chose to intervene in the case and pursue two FCA claims against JRA.[1] Before JRA answered the complaint, the parties reached a $625, 000 settlement, $106, 250 of which will go to the relator. The parties, however, could not resolve the relator's claim for attorneys' fees and costs. While JRA agrees that the relator qualifies as a prevailing party entitled to reasonable attorneys' fees and costs under the FCA, the Court must decide a "reasonable" fee award. 31 U.S.C. § 3730(d)(1).

         II. DISCUSSION

         To calculate an award, courts first determine a "lodestar" by multiplying a reasonable rate by a reasonable number of hours. Robinson v. Equifax Info. Servs., LLC, 560 F.3d 235, 243 (4th Cir. 2009). Twelve factors guide courts' discretion in formulating a lodestar:

(1) the time and labor ex1pended; (2) the novelty and difficulty of the questions raised; (3) the skill required to properly perform the legal services rendered; (4) the attorney's opportunity costs in pressing the instant litigation; (5) the customary fee for like work; (6) the attorney's expectations at the outset of the litigation; (7) the time limitations imposed by the client or circumstances; (8) the amount in controversy and the results obtained; (9) the experience, reputation and ability of the attorney; (10) the undesirability of the case within the legal community in which the suit arose; (11) the nature and length of the professional relationship between attorney and client; and (12) attorneys' fees awards in similar cases.

Id. at 243-44. Next, courts subtract fees for hours spent on unsuccessful claims that are not related to successful ones. Id. at 244. On the other hand, if unsuccessful claims arise out of the same facts or legal theories as successful claims, courts should not eliminate them from the award. McNeil v. Famuli, No. 4:15-cv-81, 2017 WL 9771834, at *10 (E.D. Va. Nov. 8, 2017). Finally, courts award some percentage of the remaining amount based on the plaintiffs degree of success. Robinson, 560 F.3d at 244.

         A fee applicant has the burden to establish the reasonableness of a requested rate. Id. In addition to the applicant's own affidavit, he must produce "satisfactory specific evidence of the prevailing market rates" for the work he performed in the relevant market. Id. The relevant market is the "community in which the court where the action is prosecuted sits," unless "the complexity and specialized nature of the case" mean that no local attorney has the required skills. Rum Creek Coal Sales, Inc. v. Caperton, 31 F.3d 169, 175, 179 (4th Cir. 1994). In this case, that market is Richmond, Virginia. See Yamaha Motor Corp. v. Jim's Motorcycle, Inc., 381 F.Supp.2d 499, 505 (E.D. Va. 2005) (using Richmond rates for a case pending in this division).

         The relator's fee petition refers to the "Laffey Matrix." The Laffey Matrix shows reasonable rates for attorneys in Washington, D.C., but it does not serve as a "reliable indicator" for attorney rates in the Eastern District of Virginia. Robinson, 560 F.3d at 245 (declining to apply the Laffey Matrix in the Alexandria division). The Laffey Matrix "is largely irrelevant" to the Richmond market in particular because "[r]ates in Washington, D.C. are considerably higher than those in Richmond for equally qualified and experienced attorneys." McAfee v. Boczar, 906 F.Supp.2d 484, 493 n.3 (E.D. Va. 2012), rev'd on other grounds, 738 F.3d 81 (4th Cir. 2013). Additionally, regional rate surveys, like those from the National Law Journal, do not qualify as the type of specific rate evidence a fee applicant needs to carry his burden. In re Star Sci, Inc., No. 1:13-cv-550, 2016 WL 4820637, at *6 n.9 (E.D. Va. Aug. 3, 2016) (citing Westmoreland Coal Co. v. Cox, 602 F.3d 276 (4th Cir. 2010)).

         Here, the relator's evidence does not demonstrate the reasonableness of counsel's fees. First, the Laffey Matrix does not help the relator. The relator's attorneys, located near Washington, D.C, in Greenbelt, Maryland, point out that they request rates slightly lower than the Laffey Matrix. (Dk. No. 51-1, at 6.) But the Matrix represents rates "considerably higher" than rates in the Richmond market. McAfee, 906 F.Supp.2d at 493 n.3 (emphasis added). Moreover, to rely on the Laffey Matrix, the relator would have to show that he had to find counsel in Washington, D.C, because no Richmond attorney could have handled this complex FCA case. See Rum Creek, 31 F.3d at 179. The relator has not done so here.

         Additionally, Nicholas Woodfield submitted a supporting affidavit for the fee petition, but his office is in the Washington, D.C. area. He says he learned about the Richmond market by "reading other attorneys' fee applications and supplying affidavits." (Dk. No. 51-5, at 2.) The Court does not find Woodfield's affidavit persuasive for this market. See McNeil, 2017 WL 9771834, at *6 (rejecting Woodfield's opinion for a fee petition in the Newport News division). The relator also submitted an affidavit from Zachary Kitts, an FCA attorney based in northern Virginia, just outside of Washington, D.C. Kitts similarly relied on affidavits from other cases to form his opinion about Richmond rates. Moreover, Kitts cited a National Law Journal survey, a source that does not prove the customary fee in a given market. See In re Star ScL, 2016 WL 4820637, at *6 n.9 ("[T]he Court cannot accept the survey from the National Law Journal as an adequate substitute for the 'specific evidence' of applicable rates.").

         While the relator's attorneys certainly possess the experience and skill that an FCA case requires, the relator has not carried his burden to demonstrate the reasonableness of their rates in the Richmond market. Accordingly, the Court will reduce counsel's rates, except for law clerk rates, by 20%.[2] See, e.g., In re Mediation in Health Diagnostic, Lab., Inc., No. 3:17-mc-4, 2018 WL 524711, at *5-6 (E.D. Va. Jan. 23, 2018) (awarding a $400 rate for a partner and a $200 rate for an associate when the movant did not prove the reasonableness of higher rates). This yields an hourly rate of $425 for Brian J. Markovitz; $273 for Matthew E. Kreiser; $263 for Timothy L. Creed and Jason M. Sarfati; and $159 for N. Brenda Adimora and William J. Fuller.

         The Court next turns to a reasonable number of hours for this case. Counsel must exercise billing judgment as to the hours worked. Hyatt v. Barnhart,315 F.3d 239, 253 (4th Cir. 2002). When reviewing timesheets, courts look for duplication of work, "lumping" of multiple tasks into one time entry, and vague or inadequate task descriptions. In re Star ScL, 2016 WL 4820637, at *7-8. In the fee petition, the relator's attorneys reduced their hours ...


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