Weiss et al v. United Seating and Mobility LLC

Filing 58

ORDER granting as modified 40 Motion for Attorney Fees. IT IS FURTHER ORDERED that Plaintiff-Relators shall be granted $263,970 in attorneys' fees and $2,887 in expenses. Signed by Judge Steven P Logan on 10/28/24. (MJW)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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Damian Weiss ex rel. United States of )
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America, et al.,
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Plaintiffs,
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vs.
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United Seating and Mobility LLC, et )
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al.,
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Defendants.
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No. CV-20-01573-PHX-SPL
No. CV-21-01306-PHX-SPL (consol.)
No. CV 22-01899-PHX-SPL (consol.)
ORDER

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Before the Court is Plaintiff-Relators’ Motion for Attorneys’ Fees (the “Motion”)

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(Doc. 40), Defendant’s (“NuMotion’s”) Response (Doc. 45), and Relators’ Reply (Doc.

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51). The Court now rules as follows.1
I.

BACKGROUND

This Motion arises out of a qui tam litigation settlement between Defendant
NuMotion and the United States government. (Doc. 40 at 5). In early 2019, PlaintiffRelators Damian Weiss and Sean Weiss, both former employees of NuMotion (Doc. 1 at
9), reported concerns to NuMotion management about the company engaging in improper
billing and therapeutic practices relating to the sale of Complex Rehab Technology
(“CRT”) (Doc. 40 at 5–6). NuMotion is a company focused on marketing and selling CRT,
which includes motorized wheelchairs and other devices that improve mobility. (Doc. 1 at

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Because it would not assist in resolution of the instant issues, the Court finds the
pending motion is suitable for decision without oral argument. See LRCiv. 7.2(f); Fed. R.
Civ. P. 78(b); Partridge v. Reich, 141 F.3d 920, 926 (9th Cir. 1998).

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6; Doc. 40 at 5). NuMotion sells upwards of $500 million in motorized wheelchairs per

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year, much of which is paid for through Medicare, Medicaid, or similar state programs.

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(Doc. 40 at 5).

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The process by which NuMotion markets and sells its CRT largely occurs through

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its salespeople known as Assistive Technology Professionals, or “ATPs.” (Id.; Doc. 1 at

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6). ATPs are credentialed to assess potential clients and fit them with the proper CRT

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equipment, but in order for Numotion to provide CRT to a client, it must have relevant

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medical documentation, including a specialty CRT evaluation form executed by a non-

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Numotion licensed physical or occupational therapist or psychiatrist. (Doc. 45 at 7). In their

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Complaint, Relators alleged that Numotion was engaging in a widespread practice of

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having its ATPs complete portions of the CRT evaluation forms for the therapists,

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otherwise known as “scribing,” in violation of the False Claims Act (“FCA”). (Id. at 6–7).

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Relators contend that “NuMotion ATPS are incentivized to fill out for themselves the

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requisite medical evaluation documents so they can reap higher commissions.” (Doc. 40 at

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5–6).

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According to Relators, they reported their concerns about scribing to NuMotion’s

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management starting in January 2019. (Id. at 6). NuMotion subsequently self-reported at

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least one incident of scribing to the U.S. Department of Justice (“DOJ”) in May 2019. (Id.

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at 7; Doc. 45 at 8). However, Relators allege that NuMotion “minimized the extent of [its]

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wrongdoing” during this May 2019 DOJ meeting. (Doc. 40 at 7). Numotion contends that

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it continued its internal investigation and remediation efforts throughout 2019 and turned

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over all relevant data to the U.S. Attorney’s Office (“USAO”). (Doc. 45 at 8–9). On August

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7, 2020, Relators filed their qui tam complaint concerning NuMotion’s scribing practices,

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retaining the firm Schneider Wallace Cottrell Konecky LLP (“SWCK”) to assist them.

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(Doc. 40 at 1, 7; Doc. 1). In November 2020, Relators were interviewed by the DOJ for

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several hours, and in December 2020, Relators provided investigative materials to the DOJ

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“that provided further information on how widespread NuMotion’s practices were.” (Doc.

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40 at 7). Two additional qui tam actions based on the same alleged scribing conduct were
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filed against NuMotion in 2021 (the “Vega” complaint) and 2022 (the “Prager” complaint).

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(Doc. 45 at 14).

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In August 2024, NuMotion settled with the USAO for $13.5 million, of which

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Relators received $2,025,000. (Id. at 9). Relators are now seeking $425,030 in attorneys’

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fees, which is a 1.23 times multiplier on their calculated lodestar of $345,553. (Doc. 40 at

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5). They are also requesting $2,887 for costs and expenses. (Id.). NuMotion does not

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challenge Relators’ $2,887 in requested expenses (Doc. 45 at 13); however, NuMotion

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argues that Relators are entitled to an attorneys’ fee award of no more than $48,635.90 (Id.

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at 13–14).

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II.

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In a qui tam action pursuant to the False Claims Act (“FCA”), a plaintiff is entitled

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to receive “an amount for reasonable expenses which the court finds to have been

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necessarily incurred, plus reasonable attorneys’ fees and costs. All such expenses, fees, and

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costs shall be awarded against the defendant.” 31 U.S.C. § 3730(d)(1). “After determining

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that a basis exists for a proper award of attorney fees, the Court must calculate a reasonable

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fee award. Generally, the Court utilizes the ‘lodestar figure,’ which multiplies the number

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of hours reasonably expended on the litigation by a reasonable hourly rate.” United States

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ex. rel. Rafter H Constr., LLC v. Big-D Constr. Corp., 350 F. Supp. 3d 938, 940 (D. Idaho

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2018) (citing Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)); see also Carter v. Caleb

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Brett LLC, 757 F.3d 866, 868 (9th Cir. 2014) (noting that the lodestar method is the correct

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framework for calculating reasonable attorneys’ fees under federal fee-shifting statutes).

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LEGAL STANDARD

To determine whether requested attorneys’ fees are reasonable, courts within the
Ninth Circuit look to some or all of twelve relevant “Kerr” factors:
The Kerr factors are (1) the time and labor required; (2) the
novelty and difficulty of the questions involved; (3) the skill
requisite to perform the legal service properly; (4) the
preclusion of other employment by the attorney due to
acceptance of the case; (5) the customary fee; (6) whether the
fee is fixed or contingent; (7) time limitations imposed by the
client or the circumstances; (8) the amount involved and the
results obtained; (9) the experience, reputation, and ability of
the attorneys; (10) the “undesirability” of the case; (11) the
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nature and length of the professional relationship with the
client; and (12) awards in similar cases.
Quesada v. Thomason, 850 F.2d 537, 539 n.1 (9th Cir. 1988). These factors have also been
adopted into the Local Rules of Civil Procedure (“LRCiv”):

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(A) The time and labor required of counsel;
(B) The novelty and difficulty of the questions presented;
(C) The skill requisite to perform the legal service properly;

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(D) The preclusion of other employment by counsel because of
the acceptance of the action;

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(E) The customary fee charged in matters of the type involved;

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(F) Whether the fee contracted between the attorney and the
client is fixed or contingent;

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(G) Any time limitations imposed by the client or the
circumstances;

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(H) The amount of money, or the value of the rights, involved,
and the results obtained;

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(I) The experience, reputation and ability of counsel;
(J) The “undesirability” of the case;

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(K) The nature and length of the professional relationship
between the attorney and the client;

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(L) Awards in similar actions; and

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(M) Any other matters deemed appropriate under the
circumstances.

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LRCiv 54.2(c)(3).

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The party seeking attorneys’ fees has the burden of proving the hours worked, rate

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paid, and “that the rate charged is in line with the ‘prevailing market rate of the relevant

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community.’” Carson v. Billings Police Dep’t, 470 F.3d 889, 891 (9th Cir. 2006) (citations

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omitted). Ultimately, a district court “has discretion in determining the amount of a fee

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award.” Hensley v. Eckerhart, 461 U.S. 424, 437 (1983); see also Gates v. Deukmejian,

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987 F.2d 1392, 1398 (9th Cir. 1992) (“The district court has a great deal of discretion in

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determining the reasonableness of the fee and, as a general rule, we defer to its
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determination, including its decision regarding the reasonableness of the hours claimed by

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the prevailing party.”).

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III.

DISCUSSION

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NuMotion “does not dispute that Relators are entitled to some reasonable attorneys’

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fees under the FCA,” nor does it dispute that Relators’ counsel “expended hours working

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on this case.” (Doc. 45 at 12). However, they take issue with “the number and value of

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hours SWCK spent” on the case. (Id.). In calculating the lodestar amount of attorneys’ fees

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Relators’ counsel (SWCK) are entitled to, the Court will consider each of NuMotion’s

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disputes.
A.

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Calculating the Lodestar
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Reasonable Hours Expended

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“In calculating the lodestar, district courts ‘have a duty to ensure that claims for

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attorneys’ fees are reasonable,’ and a district court does not discharge that duty simply by

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taking at face value the word of the prevailing party’s lawyer for the number of hours

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expended on the case.” Vogel v. Harbor Plaza Ctr., LLC, 893 F.3d 1152, 1160 (9th Cir.

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2018) (citations omitted) (emphasis in original). “In a contested case, a district court

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ordinarily can rely on the losing party to aid the court in its duty by vigorously disputing

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any seemingly excessive fee requests.” Id.

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In the present case, NuMotion vigorously disputes Relators’ fee requests for a few

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main reasons: (1) that counsel request fees for “excessive and duplicative” work (Doc. 45

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at 14); (2) that they inappropriately request fees for time sent determining how to split

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Relators’ share of the settlement with other relators (Id. at 16); (3) that they seek fees for

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issues concerning the instant fee Motion (Id.); and (4) that they have impermissibly block

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billed a number of fee entries (Id. at 18). The Court will address each of these arguments

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in turn.

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a.

Excessive and Duplicative Fees

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NuMotion argues that SWCK spent excessive time on obtaining pro hac vice

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admission to this Court, preparing Relators for interviews, sending emails concerning
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extensions, working on discovery that was done by Relators themselves, and doing

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unnecessary research on first-to-file issues. (Id. at 14).

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As to the hours spent on obtaining pro hac vice admission (Doc. 55-1 at 10), courts

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“have taken different views on whether fees may be recovered for such work and, if so,

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whether they may be recovered at the attorney rate or the paralegal rate.” Reg’l Local Union

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Nos. 846 & 847 v. LSRI, Ltd. Liab. Co., 2024 WL 3717512, at *2 (D. Or. Aug. 7, 2024).

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Here, nearly all the hours billed in relation to pro hac vice admission were entered by Kelle

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Winter, a paralegal, with only half an hour of total time spent on the issue by attorneys.

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(Doc. 55-1 at 10). NuMotion has presented the Court with no case law or specific argument

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explaining why spending 6.4 total hours obtaining pro hac vice admission is excessive,

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especially where the vast majority of the work was performed by a paralegal, and as such,

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the Court will not exclude any fee entries on this basis.

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Next, NuMotion argues that counsel spent excessive time preparing Relators for

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interviews with the DOJ. (Doc. 45 at 14; Doc. 55-1 at 11). NuMotion does not make a

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specific argument for excluding these fees except that “counsel already should have been

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familiar with the issues when [drafting the] complaint and disclosure statement.” (Doc. 55-

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1 at 11). However, SWCK notes that NuMotion includes both the time entries for the actual

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interviews and for interview preparations, and that the time SWCK spent reviewing the

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complaint and further researching the allegations in preparation for the interviews was only

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10 total hours. (Doc. 51 at 7). The Court has reviewed these entries and does not find the

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hours worked unreasonable.

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NuMotion also raises the concern that counsel spent excessive time on “emails

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concerning extensions.” (Doc. 45 at 14; Doc. 55-1 at 9). Once again, NuMotion “identifies

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no authority supporting its implicit argument that time spent drafting a request for an

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extension of time is per se unrecoverable” under the FSA. Citizens Allied for Integrity &

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Accountability, Inc. v. Schultz, 2019 U.S. Dist. LEXIS 79549, at *7 n.2 (D. Idaho May 8,

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2019). In motions for attorneys’ fees brought pursuant to other federal statutes, district

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court “have reached different results on the question of awarding attorney fees for motions
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seeking extensions of time.” Perea v. Colvin, 2014 U.S. Dist. LEXIS 196966, at *6

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(D.N.M. Feb. 27, 2014). SWCK notes that it “billed 5.5 hours for telephone calls and

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emails related to multiple requests for seal extensions in a case that spanned multiple

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years,” and that “some of the entries disputed by NuMotion indicate that the telephone call

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or email at issue concerned more than just the seal extension.” (Doc. 51 at 6). The Court

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therefore agrees with Relators that these entries appear reasonable.

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NuMotion’s argument that SWCK did “excessive work on ‘discovery’ when it was

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Relators—not their counsel—that did the work” is not supported by any specific evidence.

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(Doc. 45 at 14). Furthermore, the Court notes that a total of only 3.3 hours was spent on

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these disputed discovery-related tasks. The Court declines to exclude these entries.

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Finally, NuMotion argues that SWCK “spent over 85 hours unreasonably

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researching and analyzing straightforward, established first to file issues.” (Id.). They argue

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that because the language of the FCA clearly and unambiguously establishes a first-to-file

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bar, which prevents successive plaintiffs from filing actions based on the same facts,

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SWCK should not have spent as much time as it did researching, analyzing, and discussing

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first-to-file issues. (Id. at 14–15). Specifically, NuMotion notes that Relators’ complaint

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was filed “nearly a year before the next in time Vega complaint.” (Id. at 15). SWCK,

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however, argues that (1) “many of the time entries NuMotion disputes go beyond research

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and include other tasks, such as calls and communications with DOJ”; and (2) the time

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counsel spent on first-to-file issues was both reasonable and a “conservation of resources,”

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as “SWCK suspects that had the parties not resolved the first-to-file issue prior to

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settlement, Relators Vega and Prager may have chosen to pursue their individual cases,

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and NuMotion likely would have filed a motion to dismiss the two cases based on the first-

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to-file bar.” (Doc. 51 at 7–8).

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The Court acknowledges that, based on the recorded time entries, there may have

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been duplicative work done on the first-to-file issue. In January–April 2023, Mark Ram,

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Matthew Weiler, Raymond Levine, and Janis Gorton all made billing entries pertaining to

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research, analysis, or discussion of the first-to-file issue. (Doc. 55-1 at 12–18). However,
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as the Ninth Circuit has previously acknowledged,
[D]etermining whether work is unnecessarily duplicative is no
easy task. When a case goes on for many years, a lot of legal
work product will grow stale; a competent lawyer won't rely
entirely on last year’s, or even last month’s, research: Cases are
decided; statutes are enacted; regulations are promulgated and
amended. A lawyer also needs to get up to speed with the
research previously performed. All this is duplication, of
course, but it’s necessary duplication; it is inherent in the
process of litigating over time.
Moreno v. City of Sacramento, 534 F.3d 1106, 1112 (9th Cir. 2008) (emphasis in original).
The present case proceeded over several years: the first entries related to the first-to-file
and fee-sharing issues are from October 2021 (Doc. 55-1 at 12), while the last entries are
in August 2024 (Id. at 17–18). This Court has no basis on which to decide which of these
entries, specifically, are duplicative.
The Ninth Circuit has found that “district court can impose a small reduction, no
greater than 10 percent—a ‘haircut’—based on its exercise of discretion and without a
more specific explanation.” Moreno, 534 F.3d at 1112. As discussed further below, the
Court will exercise its discretion to impose a 10 percent “haircut” on the requested fees,
which will help account for any duplicative work spent on first-to-file issues.
b.

Fee Sharing Agreement

NuMotion contests time entries from SWCK that “reflect discussions about a fee
sharing agreement among Relators here, Relator Vega, and Relator Prager” because the
agreement “added nothing to the government’s recovery.” (Doc. 45 at 16). However,
Relators’ counsel argues that the fee-sharing agreement saved government resources that
would otherwise have been expended on additional litigation. (Doc. 51 at 8).
The only case law cited by NuMotion to support its argument is Kingston v. Int’l
Bus. Machines Corp., 2022 WL 17884456 (W.D. Wash. Dec. 23, 2022). In that case, the
district court did not award fees on time spent obtaining financing for a law firm, noting
that it was “a business decision exclusively within the purview of that law firm,” and was
therefore more appropriately billed to the management of the firm, not to an opposing

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party. Id. at *9. The situation here is easily contrasted with that in Kingston. Here, SWCK

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is not seeking fees for business that was done for the sole benefit of their firm, such as

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obtaining financing. Rather, the disputed entries pertain to settlement strategy, which

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directly involved Relators, the relators in the other cases against NuMotion, and the DOJ.

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(Doc. 55-1 at 19–30). These entries are all for work that was necessary to resolve Relators’

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own case and facilitate the ultimate settlement between NuMotion and the United States

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government. Furthermore, Relators’ counsel specifically notes that they “removed time

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entries that were for tasks that appear non-compensable, such as time that was spent strictly

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negotiating the relators’ share in connection with the DOJ settlement,” and that the

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remaining entries “were for the dual purpose of determining the fairness and adequacy of

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the DOJ settlement.” (Doc. 40 at 20–21). The Court therefore declines to exclude any fee

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entries on this basis.

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c.

Fees on Fees

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Next, NuMotion argues that SWCK seeks “grossly inflated” and “duplicative” fees

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for work on the present fee Motion and asks the Court to exclude 45.8 disputed hours.

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(Doc. 45 at 16; Doc. 55-1 at 31). Additionally, NuMotion argues that the fees on fees should

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be reduced because SWCK failed to comply with LRCiv 54.2(d)(1), which requires

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counsel to attach a statement of consultation to a fee motion “certifying that, after personal

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consultation and good faith efforts to do so, the parties have been unable to satisfactorily

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resolve all disputed issues relating to attorneys’ fees or that the moving counsel has made

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a good faith effort, but has been unable, to arrange such conference.” (Doc. 45 at 17).

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The Ninth Circuit has held that “[a] district court can reduce a fees-on-fees request

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in proportion to the applicant’s success on the underlying petition.” United States ex rel.

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Sant v. Biotronik, Inc., 716 F. App’x 590, 593 (9th Cir. 2017) (determining that a 30%

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reduction of requested hours for work performed on a fee petition was warranted where the

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court had denied more than 70% of the requested fees on the underlying litigation). Here,

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in contrast to Biotronik, the Court is denying a much smaller overall percentage of SWCK’s

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requested fees. Nonetheless, the Court agrees that SWCK has not entirely complied with
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LRCiv 54.2(d)(1), as the instant Motion was filed before SWCK met and conferred with

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NuMotion’s counsel. (Doc. 45 at 17). In reply, SWCK notes that they were in the process

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of negotiating a settlement offer regarding Relators’ claim for attorneys’ fees, and that they

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scheduled a call for September 6, 2024 (the day after the Motion was due) to discuss that

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proposed settlement. (Doc. 40-1 at 2). However, because SWCK’s motion for extension

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(Doc. 39) was not granted, they were forced to file before that call was completed as to not

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miss their filing deadline. (Doc. 51 at 11). The deficiency of a fee applicant’s statement of

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consultation “is not necessarily fatal to its request for fees.” Skydive Arizona, Inc. v.

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Quattrocchi, 2011 WL 1004945, at *1 (D. Ariz. Mar. 22, 2011). However, other courts in

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this District have reduced fee awards based on non-compliance. E.g., Jarman v. Am. Fam.

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Ins. Co., 2021 WL 1947509, at *3 (D. Ariz. May 14, 2021) (subtracting 16.3 hours spent

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preparing fee application); Sw. Fair Hous. Council v. WG Chandler Villas SH LLC, at *4

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(D. Ariz. July 10, 2023).

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As mentioned above, the Court will exercise its discretion to apply an overall 10%

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“haircut” to the fees requested by Relators’ counsel, which the Court also finds a sufficient

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penalty for SWCK’s failure to comply with 54.2(d)(1) in this instance.

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d.

Block Billing

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Finally, NuMotion contests a number of entries for the alleged use of impermissible

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block-billing practices. (Doc. 45 at 18–19). True block billing defies the Supreme Court’s

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warning that attorneys’ fees applicants “should maintain billing time records in a manner

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that will enable a reviewing court to identify distinct claims,” Hensley, 461 U.S. at 437,

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and also violates LRCiv 54.2(e). While the entries disputed by NuMotion do tend to list

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multiple tasks together, those tasks generally appear to be related to one another;

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furthermore, none of the entries exceed 2.20 hours; in fact, most of them do not even exceed

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1 hour of work billed. (Doc. 55-1 at 33–34). See United States v. Allergan, Inc., 2023 WL

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4754637, at *5 (C.D. Cal. July 24, 2023) (noting that “[c]ourts in the Ninth Circuit

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generally reduce entries exceeding one hour” but that “[b]lock-billed entries are

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permissible where entries contain sufficient specificity for courts to discern whether the
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time spent performing tasks was reasonable”). The Court therefore does not find that a

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reduction in the lodestar is warranted on this basis.
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Reasonable Hourly Rate

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In addition to determining whether the number of hours expended on a case are

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reasonable, the district court must also “evaluate if the hourly rates at which [a fee

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applicant] seeks compensation for those hours are reasonable.” United States ex rel. Savage

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v. CH2M Hill Plateau Remediation Co., 2020 WL 8678018, at *3 (E.D. Wash. June 3,

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2020). Here, SWCK states that “[t]he lead attorneys on this case, Mr. Weiler and Janis

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Gorton, have billing rates of $1100 and $985 per hour, respectively”; that “Mr. Kim’s rates

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of $1295 are reasonable”; that the “rates for James Bloom, Raymond Levine, Kyle Bates,

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Mark Ram, and Ryan Hecht,” which range from $690 to $1,155, “are all reasonable”; and

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that “$450 an hour is reasonable for Kelle Winter, who performs paralegal services at

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SWCK.” (Doc. 40 at 17–18). In the affidavit submitted by Mr. Weiler, he states that

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“SWCK billing rates are the same for its contingency clients”—including Relators, in this

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case—“as for any other client,” and that SWCK charges its large business clients “the same

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hourly rates, when it does hourly advisory work, as it does in the fee application it submits

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here.” (Doc. 41 at 7). SWCK argues that the rates it seeks “are reasonable given the

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complexity of qui tam cases, the experience of counsel,” and the other Kerr factors. (Doc.

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51 at 13).

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It is not entirely clear whether the rates listed in SWCK’s time entries (Doc. 43-4)

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are the hourly rates actually charged in this case, or whether the rates are simply those they

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deem “reasonable” or that they would charge to large business clients (which Relators are

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not). NuMotion emphasizes that “Relators notably do not say their counsel ever receives

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this rate from paying clients.” (Doc. 45 at 19). Without knowing the actual rate SWCK

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charged to Relators in this case, it is more difficult for this Court to determine what

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constitutes a reasonable hourly rate in a qui tam case that was filed in the District of Arizona

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yet litigated by a law firm based in California. SWCK acknowledges that it “could find no

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precedent in Arizona regarding reasonable hourly rates for attorneys in False Claims Act
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cases, nor did NuMotion cite any in its response.” (Doc. 51 at 11). Rather, SWCK’s

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proposed rates “are based on the prevailing rates for attorneys with comparable experience

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in the U.S. District Court for the Northern District of California, where SWCK is based.”

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(Doc. 41 at 7). NuMotion, for its part, argues that this Court should simply apply

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“reasonable rates in Arizona for AM200 firms . . . which, for SWCK, is overly generous

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since SWCK is not an AMLaw firm at all.” (Doc. 45 at 20).

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Courts within this District have found that “[t]he prevailing market rate in the

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community [in which the district court sits] is indicative of a reasonable hourly rate.”

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Orman v. Cent. Loan Admin. & Reporting, 2020 WL 919302, at *2 (D. Ariz. Feb. 26, 2020)

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(quoting Jordan v. Multnomah Cnty., 815 F.2d 1258, 1262 (9th Cir. 1987)); see also

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Innovative Sports Mgmt. Inc. v. Singh, 2020 WL 3574582, at *2 (D. Ariz. July 1, 2020).

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However, the Ninth Circuit has held that, under another federal fee-shifting statute, non-

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forum rates may be applied “if local counsel was unavailable, either because they are

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unwilling or unable to perform because they lack the degree of experience, expertise, or

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specialization required to handle properly the case.” Gates, 987 F.2d at 1405; see also

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United States ex rel. Savage v. Washington Closure Hanford LLC, at *3 (E.D. Wash. Aug.

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27, 2019).

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This Court must also evaluate counsel’s degree of experience, expertise, and

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specialization in the context of the Kerr and LRCiv 54.2(c)(3) factors. SWCK argues that

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the instant litigation required significant time and labor (over 400 hours) (Doc. 40 at 11);

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that it involved a novel set of facts, given that “to Relators’ knowledge, liability for scribing

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has never been litigate under the False Claims Act” (Id. at 12); that SWCK possesses the

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specialized skill set necessary to perform qui tam litigation (Id. at 13); that it is requesting

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rates similar to those sought by NuMotion’s counsel in a qui tam matter in Houston, Texas

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(Id. at 14); that the $13.5 million settlement obtained is “an excellent result by the standards

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of healthcare fraud qui tam litigation” (Id. at 15); that SWCK has “substantial experience

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in litigating qui tam cases” (Id. at 16); and that “[c]ourts have granted substantially larger

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fee requests in qui tam litigation that settled for less than this action” (Id. at 18–19).
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However, Relators’ counsel acknowledges that they have not had to turn down “any other

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engagement specifically due to this qui tam case.” (Id. at 13).

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If the Court were to apply the generally prevailing rates in the Phoenix, Arizona

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marketplace, the billing rates requested by SWCK are unquestionably excessive. (Doc. 45-

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1 at 6). See, e.g., Washington v. Freedom of Expression LLC, 2022 U.S. Dist. LEXIS

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181707, at *4 (D. Ariz. Oct. 4, 2022) (collecting cases in Arizona awarding attorneys’ fees

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at rates below $500 for associates). However, SWCK has made its case that qui tam

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litigation requires a specialized skill set and justifies hiring specialized, rather than local,

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counsel. (Doc. 40 at 12–13). The Ninth Circuit has also described qui tam cases as

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“complicated” and involving “complex legal and factual issues.” Stoner v. Santa Clara

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Cty. Office of Educ., 502 F.3d 1116, 1128 (9th Cir. 2007). This justifies SWCK’s request

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for non-forum rates.

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However, even when applying market rates from cases in the Northern District of

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California, rather than the District of Arizona, SWCK’s requested rates are still high. (Doc.

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41-12 at 2 (noting that the top 100 U.S. law firms charged an average rate of $961/hour in

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2023)). See also, e.g., Franchek v. Workrite Ergonomics, LLC, 2022 WL 3137928, at *15

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(N.D. Cal. May 9, 2022), report and recommendation adopted, 2022 WL 3137918 (N.D.

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Cal. May 31, 2022) (awarding fees based on partner rates of $919/hour and $850/hour for

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highly experienced attorneys in FCA qui tam litigation); see also In re Magsafe Apple

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Power Adapter Litig., 2015 WL 428105, at *12 (N.D. Cal. Jan. 30, 2015) (noting that in

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2015, reasonable hourly rates for partners in the Bay Area ranged from $560 to $800);

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Miletak v. AT&T Servs., Inc., 2020 WL 6497925, at *6 (N.D. Cal. Aug. 3, 2020) (“District

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courts in Northern California have found that rates of $475-$975 per hour for partners and

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$300-490 per hour for associates are reasonable.”). The Court will therefore reduce the

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reasonable hourly rate for partners on this case to $950/hour.

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SWCK also urges this Court to apply rates on par with Allergan, Inc., 2023 U.S.

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Dist. LEXIS 128732, at *8. (Doc. 40 at 13–14; Doc. 51 at 13). That case awarded a rate of

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$400/hour for litigation support personnel in FCA qui tam litigation, which is lower than
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the $450/hour rate that SWCK is seeking for its paralegal. Other cases in the Northern

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District of California have awarded much lower rates as well. See, e.g., In re Magsafe Apple

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Power Adapter Litig., 2015 WL 428105, at *12 (noting that rates for paralegals and

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litigation support staff range from $150 to $240 in the Bay Area); TPCO US Holding, LLC

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v. Fussell, 2023 U.S. Dist. LEXIS 139089, at *7 (N.D. Cal. Aug. 9, 2023) (approving a

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$305/hour billable rate for a paralegal based on her two decades of experience).

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Accordingly, the Court will apply a rate of $400/hour for SWCK’s paralegals.

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Finally, the Court finds that an hourly rate of $750/hour for SWCK’s associates to

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be an appropriate adjusted rate, which is within the range of the various rates requested by

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SWCK for attorneys with the classification “Of Counsel / Associates” in this litigation.

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(Doc. 53-4 at 2–28). See, e.g., In re Wells Fargo & Co. Shareholder Derivative Litig., 445

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F. Supp. 3d 508, 527 (N.D. Cal. 2020), aff’d, 845 F. App’x 563 (9th Cir. 2021) (approving

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rates of $250–660 for associates and $365–420 for staff attorneys in complex shareholder

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derivative action); In re Anthem, Inc. Data Breach Litig., 2018 WL 3960068, at *17 (N.D.

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Cal. Aug. 17, 2018) (noting that billing rates for most non-partner attorneys were under

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$500 in complex class action settlement). This rate accounts for the complexities of qui

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tam litigation, the experience of counsel, and the other Kerr factors and considerations

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listed within LRCiv 54.2(c)(3).

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B.

Calculation and Multiplier

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With the above modifications to SWCK’s requested billing rates, the Court can now

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calculate the appropriate lodestar. The Court finds that based on the time entries submitted

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to the Court, SWCK billed a total of 144.5 hours to partners, 194.7 hours to associates and

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“of counsel,” and 25 hours to paralegals and law clerks. (Doc. 53-4). The reasonable

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loadstar, based on rates of $950/hour for partners, $750/hour for associates and “of

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counsel,” and $400/hour for paralegals and law clerks, therefore comes out to $293,300.

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However, as previously noted, this Court will subtract a 10% “haircut” to account for

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potentially duplicative work, and because SWCK failed to comply with LRCiv 54.2(d)(1).

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The resulting lodestar amount is $263,970.
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However, SWCK also requests this Court to apply a 1.23 multiplier “for their

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efficiency and advocacy in achieving the instant result.” (Doc. 40 at 19). “Although in most

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cases, the lodestar figure is presumptively a reasonable fee award, the district court may, if

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circumstances warrant, adjust the lodestar to account for other factors which are not

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subsumed within it.” Ferland v. Conrad Credit Corp., 244 F.3d 1145, 1149 n.4 (9th Cir.

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2001); see also Van Gerwen v. Guar. Mut. Life Co., 214 F.3d 1041, 1045 (9th Cir. 2000)

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(“The lodestar amount is presumptively the reasonable fee amount, and thus a multiplier

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may be used to adjust the lodestar amount upward or downward only in ‘rare and

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exceptional cases’”) (internal quotation marks and citations omitted). “Thus, courts may

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also consider the factors listed in LRCiv 54.2(c)(3) when determining the reasonableness

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of an attorneys’ fee request.” Gary v. Carbon Cycle Arizona LLC, 398 F. Supp. 3d 468,

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491 (D. Ariz. 2019). However, many of these factors will have already been considered in

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the lodestar analysis, such as the time and labor required by counsel, counsel’s skill, the

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customary fee in this type of case, and the experience and reputation of counsel. See id.;

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see also, e.g., Fritch v. Orion Manufactured Hous. Specialists Inc., 2023 WL 8781248, at

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*7 (D. Ariz. Dec. 19, 2023), aff’d, 2024 WL 4449428 (9th Cir. Oct. 9, 2024).

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The primary justification given by SWCK for this Court to apply a multiplier is that

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“Relators’ [requested] lodestar of $345,553 is less than 3% of the $13.5 million settlement

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achieved here.” (Doc. 40 at 19–20). However, SWCK does not present sufficient evidence

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that this result is outstanding, as the quality of representation and successful results

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obtained were already accounted for within the Court’s adjusted hourly billing rates. See

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Pennsylvania v. Delaware Valley Citizens’ Council for Clean Air, 478 U.S. 546, 567

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(1986), supplemented, 483 U.S. 711 (1987). Not every successful result is tantamount to

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an exceptional or outstanding result. See Blum v. Stenson, 465 U.S. 886, 899 (1984) (noting

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that a district court “may justify an upward adjustment only in the rare case where the fee

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applicant offers specific evidence to show that the quality of service rendered was superior

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to that one reasonably should expect in light of the hourly rates charged and that the success

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was ‘exceptional.’”).
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Therefore, the Court declines to apply a multiplier to the lodestar fee amount.

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Accordingly,

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IT IS ORDERED that Plaintiff-Relators’ Motion for Attorneys’ Fees (Doc. 40) is

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granted as modified.
IT IS FURTHER ORDERED that Plaintiff-Relators shall be granted $263,970 in
attorneys’ fees and $2,887 in expenses.
Dated this 28th day of October, 2024.

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Honorable Steven P. Logan
United States District Judge

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