Aldridge v. Corporate Management, Inc. et al
Filing
570
ORDER granting in part and denying in part 388 Motion for Attorney Fees. Attorneys fees, expenses and costs are granted, but in a different amount than requested. Signed by District Judge Henry T. Wingate on 3/30/2022 (CGC)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
SOUTHERN DIVISION
JAMES ALDRIDGE, RELATOR,
on behalf of the
UNITED STATES OF AMERICA
PLAINTIFF
v.
Civil Action No. 1:16-CV-00369 HTW-LRA
CORPORATE MANAGEMENT INC.,
et al
DEFENDANTS
ORDER
Before this court is the motion of the Relator, James Aldridge, for Attorney’s Fees in this
case [Doc. no. 388]. The Relator seeks a total of $643,250.78 in fees and expenses. The motion
is granted in part and denied in part.
INTRODUCTION
The backdrop to this motion is a qui tam case brought by the Relator James Aldridge on
behalf of himself and the United States of America under the False Claims Act (“FCA”). Title
31 U.S.C. §3729 et seq. The Relator filed his initial Complaint with this court on May 31, 2007,
and filed an Amended Complaint on November 12, 2009. The FCA imposes liability on persons
who make false claims for payment to the federal Government. The FCA enables private
individuals (Relators) to bring suits for violations of the FCA in the United States’ name and to
receive a portion of any recovery from the Defendants. 1 The Act also provides that, after a period
of investigation, the United States may choose to intervene in the case and take over the
litigation. On September 18, 2015, the United States filed its original Intervenor Complaint,
(b) Actions by private persons.--(1) A person may bring a civil action for a violation of section 3729 for
the person and for the United States Government. The action shall be brought in the name of the
Government. The action may be dismissed only if the court and the Attorney General give written consent
to the dismissal and their reasons for consenting.
31 U.S.C. § 3730(b).
1
1
followed by an Amended Complaint on December 4, 2015. The Relator, through his attorneys,
remained an active participant in the litigation.
After years of contentious litigation, this qui tam case was tried before a jury for almost
nine weeks, beginning January 13, 2020, in Gulfport, Mississippi. The Government accused two
corporate defendants and four individual defendants of violating the False Claims Act by
submitting false or fraudulent reports for the purpose of receiving Medicare reimbursements.
The jury returned its verdict in favor of the Plaintiffs (the Relator, and the United States) and
against all but one of the Defendants, in the amount of $10,855,382.00. After this court tripled
the damages amount and added penalties, as required by 31 U.S.C. §3729, 2 the total damages
award exceeded $32,000,000.00.
I. THE RELATOR AS PREVAILING PARTY
In addition to the right to receive a percentage of the recovery, a Relator in a successful
qui tam action is entitled to receive an amount for expenses, fees, and costs. Section 3730
provides that if the Government proceeds with an action brought by a qui tam plaintiff such
person “shall also receive an amount for reasonable expenses which the court finds to have been
necessarily incurred, plus reasonable attorneys’ fees and costs. All such expenses, fees, and costs
shall be awarded against the Defendant.” 31 U.S.C. § 3730(d)(1) 3(emphasis added).
Title 31 U.S.C. § 3729 provides that any person who commits a violation of the Act under §3729(a)(1)
“is liable to the United States Government for a civil penalty of not less than $5,000 and not more than
$10,000, as adjusted by the Federal Civil Penalties Inflation Adjustment Act of 1990 (28 U.S.C.
2461 note; Public Law 104-4101), plus 3 times the amount of damages which the Government sustains
because of the act of that person.
31 U.S.C. §3729(a)(1).
2
31 U.S.C. § 3730(d)(1) provides as follows:
(d) Award to qui tam plaintiff.--(1) If the Government proceeds with an action brought by a person
under subsection (b), such person shall, subject to the second sentence of this paragraph, receive at least
15 percent but not more than 25 percent of the proceeds of the action or settlement of the claim,
depending upon the extent to which the person substantially contributed to the prosecution of the
action. . . . Any such person shall also receive an amount for reasonable expenses which the court finds to
3
2
James Aldridge, the Relator here, together with the Government, obtained a verdict of
over $10,000.000.00 (ten million dollars) and a total judgment in excess of $30 million dollars
($30,000,000.00) after the court tripled the damages award and imposed penalties as required by
§ 3729(a)(1) of the FCA. Therefore, says Aldridge, he is undeniably a prevailing party in this
litigation, and he is entitled to an award under the FCA for expenses, attorneys’ fees, and costs.
The Defendants herein, Corporate Management, Inc. (“CMI”), Harold Ted Cain (“Ted
Cain”), Julie Cain, Thomas Kuluz, and Stone County Hospital (”SCH”), counter that the claims
advanced by the Relator were based on different facts and legal theories than the claims pursued
by the Government on which the Government prevailed. Aldridge, then, the Defendants say, is
not a prevailing party because the United States did not prevail on any claim that had been
advanced by the Relator.
Defendants state the following in their Memorandum Brief [doc. no. 394]:
The relator’s complaint and amended complaint allege that Defendants
required Stone County Hospital [SCH] and a related hospital to purchase medical
supplies from a company owned by Ted Cain, transferred patients between SCH
and a nursing facility owned by Ted Cain in such a way as to maximize Medicare
and Medicaid reimbursement, and failed to collect copays and deductibles from
Medicare beneficiaries.
The jury’s verdict, say Defendants, found the Defendants liable only for matters
concerning Ted Cain’s and Julie Cain’s salaries and the 2012 and 2013 self-disallowances CMI
made from Medicaid cost reports, but not Medicare cost reports. Therefore, Defendants claim
that the United States did not prevail on any claim championed by the Relator.
have been necessarily incurred, plus reasonable attorneys' fees and costs. All such expenses, fees, and
costs shall be awarded against the defendant.
31 U.S.C. § 3730.
3
Defendants cite the Fifth Circuit case of United States ex rel. Longhi v. Lithium Power
Techs, Inc., for the proposition that the “work on an unsuccessful claim cannot be deemed to
have been expended in pursuit of the ultimate result achieved.” Longhi, 575 F.3d 458, 476 (5th
Cir, 2009) (quoting Hensley v. Eckerhart, 461 U.S. 424, 435 (1983)).
The Relator disagrees with Defendants’ assessment. The Relator, too, relies on Longhi
and Hensley, but says they support his position. In Longhi, the Fifth Circuit Court of Appeals
defined the question under consideration as “whether [the Relator’s] attorneys’ fee award should
be segregated because he was not “successful” in proving a violation of the FCA with regards to
all twenty-one contracts, as he initially had alleged. In contemplating that issue, the Longhi
Court found the United States Supreme Court case of Hensley v. Eckerhart, supra, to be
instructive.
In Hensley, the District Court determined that the plaintiffs were prevailing parties under
the Civil Rights Attorneys’ Fees Awards Act 4 even though they had not succeeded on every
claim. The trial court did not eliminate from the award any hours spent on unsuccessful claims.
Id. at 426. In reviewing the case, the United States Supreme Court said, “plaintiffs may be
considered prevailing parties if they succeed on any significant issue in litigation which achieves
some of the benefit the parties sought in bringing suit.” Id. at 433 (emphasis added).
Defendants’ argument here omits that the Relator’s Complaint also alleged cost report
fraud 5, including that Stone County Hospital cost reports fraudulently included costs that are not
4
5
Title 42 U.S.C. § 1988.
42 C.F.R. § 405.1801(b)(1) states as follows:
In order to be paid for covered services furnished to Medicare beneficiaries, a provider must file a
cost report with its contractor as specified in § 413.24 of this chapter. For purposes of this subpart,
the term “provider” includes a hospital (as described in part 482 of this chapter), hospice program
(as described in § 418.3 of this chapter), critical access hospital (CAH), comprehensive outpatient
rehabilitation facility (CORF), renal dialysis facility, Federally qualified health center (FQHC), home
4
reimbursable under the Medicare program and unallowable costs, resulting in Medicare
reimbursements to them that were much higher than that to which they were entitled. The
Relator’s Complaint, like that of the Government, also alleged “that the services identified in
annual cost reports were not provided in compliance with Medicare laws and regulations.” [doc.
nos. 2 at ¶33] [doc. no. 6 at ¶¶ 31-33].
The Relator’s First Amended Complaint includes the following language:
31. As a condition of their participation in the Medicare program, defendants Stone
County Hospital and Stone County Nursing and Rehabilitation Center are required
to certify annual cost reports. Green County Hospital and Greene County Rural
Health Center (a nursing home), both managed by defendant CMI, also certified
annual costs reports. As part of those cost reports, those entities must certify that
the services identified therein are provided in compliance with applicable laws and
regulations governing participation in federal health care benefits programs.
Defendants Stone County Hospital and Stone County Nursing and Rehabilitation
Center, as well as Greene County Hospital and Greene County Rural Health Center,
falsely certified that the services identified in their annual cost reports were
provided in compliance with these laws and regulations.
Relator’s First Amended Complaint [doc. no. 6 ¶ 31].
33. Ted Cain knowingly included in the cost reports of Stone County Hospital,
Stone County Nursing and rehabilitation Center, Greene County Hospital, and
Greene County Rural Health Center costs that are not reimbursable under the
Medicare and Medicaid programs. In addition, defendant Cain conspired with the
other defendants named herein to include and conceal these unallowable costs. As
a result of this conduct by Defendants, Medicare and Medicaid reimbursed
Defendants in an amount much higher than that to which they were legally entitled.
Relator’s First Amended Complaint [doc. no. 6 ¶ 33].
46. By virtue of the acts described herein, Defendants knowingly presented, or
caused to be presented, to the United States government false or fraudulent claims
for Medicare and/or Medicaid reimbursement, in violation of 31 U.S.C. §3729. The
precise number of false claims shall be determined through discovery and
established at trial.
health agency (HHA), rural health clinic (RHC), skilled nursing facility (SNF), and any other entity
included under the Act.
42 C.F.R. § 405.1801
5
Relator’s First Amended Complaint [doc. no. 6 ¶ 46].
50. By virtue of the acts described herein, Defendants made, used, and caused to
be made and used, false records, statements, and explicit and implicit certifications
to get false claims paid, in violation of 31 U.S.C. §3729(a)(2), as amended.
Relator’s First Amended Complaint [doc. no. 6 ¶ 50].
54. By virtue of the acts described herein, Defendants conspired together to defraud
the government in order to get false or fraudulent claims paid by Medicare and
Medicaid, in violation of 31 U.S.C. § 3729(a)(3), as amended. In furtherance of
the conspiracy, Defendants acted to affect the objects of the conspiracy alleged
herein. The precise number of false claims shall be determined through discovery
and established at trial.
Relator’s First Amended Complaint [doc. no. 6 ¶ 54].
In addition to alleging cost report fraud in the Complaint, the Relator says that prior to
the Government’s intervention, he was alleging that the Defendants had committed cost report
fraud by inter alia, falsely certifying on its Medicare cost reports that Stone County Hospital was
in compliance with Medicare laws restricting “allowable costs” to costs reasonably incurred and
related to qualified services provided for the benefit of Medicare patients. Also prior to the
Government’s intervention decision, the Relator’s attorneys say they provided information to the
United States regarding the excessive salaries of Ted Cain and Julie Cain based on information
developed by their expert consultant Robert Church.
Once the Government learned from Ted Cain, through his deposition, that he had not
performed work for the hospital that would qualify for reimbursement under the Medicare laws
and regulations, this became a core component of the Government’s case. The Relator contends
that it was the analysis made on behalf of the Relator by his attorneys and the expert consultant
they retained that enabled the United States and the Relator to prevail at the jury trial.
6
Even if, arguendo, the accusations brought by Aldridge in his Amended Complaint were
different from the claims on which the Government prevailed, these accusations and claims were
based on related legal theories, thus meeting the Longhi standard set by the Fifth Circuit.
Moreover, the significance of the overall relief can hardly be overstated, as the Plaintiffs
in the instant case won a jury verdict of over ten million dollars and a judgment (after imposition
of treble damages and penalties) of over thirty million dollars. Even if it were possible to do so,
this court is not willing to require the Relator to separate attorneys’ hours expended on individual
claims.
In Longhi, the district court observed the standards set out by Hensley in expressly
determining that the claims regarding the performance on the contracts and the claims alleging
fraudulent inducement were not factually distinct. In Longhi the district court determined that
the successful claims regarding the four contracts at issue arose from the “same set of contracts,
same actors and the same illegal intent to defraud the government of money in violation of the
FCA[]” as the unsuccessful claims. Longhi, at 476.
This court similarly determines that the cost reporting fraud for which Defendants were
found liable by a jury arose from the same set of cost reports, the same actors, and the same
illegal intent to defraud the government of money in violation of the FCA as originally alleged
by the Relator. 6
The Fifth Circuit in Longhi, held that the district court did not abuse its discretion in
finding that the level of success on the four contract claims alone was sufficient to merit
entitlement to a full attorneys’ fees award. Longhi at 476.
The Relator’s initial Complaint did name other Defendants that were subsequently dismissed from the
litigation, and one Defendant was found not liable by the jury; but the Defendants that remained in the
lawsuit were the primary actors.
6
7
Defendants have previously raised the argument that the claims brought by the
Government against these Defendants arose out of different conduct, transactions, or occurrences
than the Relator’s Complaint. 7 In arguing that some of the Government’s claims were precluded
by the FCA’s six-year statute of limitations,8 Defendants contended that the Government’s
claims were different from and did not “relate back” to the earlier Complaint filed by the Relator.
Therefore, Defendants said, the statute of limitations prevented the Government from pursuing
claims that occurred six years prior to the date the Relator filed his Compliant in 2007. Instead,
they said, the Government was limited to six years prior to the date it filed its Complaint in 2015.
Defendants argue again here that the claims brought by the Government are not tied to a
common core of operative facts as required by United States ex rel. Vavra v. Kellogg Brown &
Root, Inc., 848 F.3d 366, 382 (5th Cir. 2017) (quoting Mayle v. Felix, 545 U.S. 644, 650 & 664
(2005) (internal citations omitted).
This court stated in its Opinion that the Relator's Complaint also alleged cost report fraud,
including the allegation that SCH cost reports fraudulently included:
costs that are not reimbursable under the Medicare program and unallowable
costs, resulting in Medicare reimbursements to them that were much higher than
that to which they were entitled. The Relator's Complaint, like that of the
See Aldridge on Behalf of United States v. Corp. Mgmt., Inc., No. 1:16-CV-369 HTW-LGI, 2021
WL).2518221, at *30 (S.D. Miss. June 18, 2021) (opinion on motion for a new trial and motion for
judgment as a matter of law) appeal docketed, No. 21-60568 (5th Cir. Mar. 17, 2022).
7
Title 31 U.S.C. § 3731(b) provides:
A civil action under section 3730 may not be brought-(1) more than 6 years after the date on which the violation of section 3729 is committed, or
(2) more than 3 years after the date when facts material to the right of action are known or reasonably
should have been known by the official of the United States charged with responsibility to act in the
circumstances, but in no event more than 10 years after the date on which the violation is committed,
whichever occurs last.
31 U.S.C. § 3731.
8
8
Government, also alleged “that the services identified in annual cost reports
were not provided in compliance with Medicare laws and regulations.
[doc. nos. 2 at ¶33] [doc. no. 6 at ¶¶ 31-33]. Aldridge on Behalf of United States v. Corp. Mgmt.,
Inc., No. 1:16-CV-369 HTW-LGI, 2021 WL).2518221, at *31 (S.D. Miss. June 18, 2021)
(opinion on motion for a new trial and motion for judgment as a matter of law) appeal docketed,
No. 21-60568 (5th Cir. Mar. 17, 2022).
This court previously concluded that the claims pursued by the United States are
grounded in the claims of the Relator, and this court is not now dissuaded from that position. The
primary claims pursued by the Government were based on ‘cost report fraud,’ which was one of
the claims alleged in the Relator’s Complaint.
The Supreme Court has explained that where a plaintiff’s claims for relief involve a
common core of facts, or are based on related legal theories, it can be difficult to separate the
hours expended on each claim, and much of counsel’s time is devoted to the litigation as a
whole. In that event, “the district court should focus on the significance of the overall relief
obtained by plaintiff in relation to the hours reasonably expended on the litigation.” Id. at 435.
This court is also persuaded by the reasoning of Judge Ozerden in Rigsby v. State Farm
Fire and Cas. Co., 2014 WL 691500, Civil No. 1:06-cv-433 HSO-RHW (S.D. Miss. Feb. 21,
2014), 9 applying the Longhi principles. The Defendant in that case, State Farm Fire and Casualty
Company, complained that the bill submitted by the Relators’ attorneys included work done on
all claims, regardless of whether they were the claims on which the Relators prevailed. The
Relators had voluntarily dismissed eleven of the original Defendants without any settlement, and
Rigsby was appealed to the Fifth Circuit Court of Appeals and to the United States Supreme
Court, which denied certiorari. The issue of attorneys’ fees was not discussed on appeal.
9
9
the Relators had been unsuccessful on their claims for retaliatory discharge, reverse false claim,
and conspiracy.
Referencing Longhi, Judge Ozerden stated, “[i]n this case, the claims asserted against
State Farm derived from the same flood policy, the “same actors and the same illegal intent to
defraud the government of money in violation of the FCA.” Rigsby at *12 (quoting Longhi v.
Lithium Poser Technologies, Inc., at 476). Judge Ozerden continued, “the Court finds that the
level of success achieved by Relators on the two claims which were presented to the jury is
sufficient to merit entitlement to a full attorneys’ fee award. See id.
Similarly, in the case sub judice the claims asserted against Ted Cain and the other
defendants involve the “same actors and the same illegal intent to defraud the government of
money in violation of the FCA.” See Rigsby at *12 (quoting Longhi v. Lithium Poser
Technologies, Inc., at 476).
This court is persuaded that the Relator is a prevailing party in this litigation and, further,
is entitled to an award of reasonable expenses, fees and costs as provided for by the FCA.
II. LODESTAR
Aldridge has provided this court with the itemized statements and declarations of the
three attorneys who represented him throughout this protracted litigation.
This court’s decision on attorneys’ fees must address the “lodestar” calculation, which
requires the court to determine the reasonable number of hours expended on the litigation and the
reasonable hourly rates for the participating lawyers. The district court must then multiply the
reasonable hours by the reasonable hourly rates. See Perdue v. Kenny A. ex rel. Winn, 559 U.S.
542, 552 (2010); Hensley v. Eckerhart, 461 U.S. 424, 433 (1983); La. Power & Light Co. v.
Kellstrom, 50 F.3d 319, 324 (5th Cir.1995). See also See, e.g., United States ex rel. Vuyyuru v.
10
Jadhav, 555 F.3d 337, 356–57 (4th Cir.2009); Gonter v. Hunt Valve Co., 510 F.3d 610, 616–17
(6th Cir.2007) (utilizing lodestar method in FCA cases).
As described in Hensley v. Eckerhart, supra, the court must engage in a two-step process.
After making the lodestar calculation the court must examine the award in light of the Johnson
factors to assess whether any further adjustment is necessary. See Johnson v. Georgia Highway
Express, Inc. 488 F.2d 714 (5th Cir.1974).
The lodestar amount is presumed to be reasonable; but it can be adjusted upward or
downward by the court based on certain factors as delineated in Johnson v. Georgia Highway
Express, Inc. 488 F.2d 714 (5th Cir.1974). In Johnson, the Fifth Circuit Court of Appeals
espoused twelve factors to be considered in deciding whether the lodestar should be adjusted. Id.,
at 718. See also, Watkins v. Fordice, 7 F.3d 453, 459 (5th Cir.1993); Alexander v. City of
Jackson Miss., 456 F. App'x 397, 399 (5th Cir. 2011). The Relator, in his “Motion for Attorneys’
Fees, Litigation Expenses and Costs,” asks this court to make an upward adjustment of thirty
percent (30%), based on the relevant Johnson factors.
This court will first undertake to make the lodestar calculation, and will then, using the
factors set out in Johnson, evaluate the necessity of an upward or downward adjustment of that
figure.
A. Hourly Rates
Over the course of this fourteen-year litigation, the Relator was represented by three
attorneys. Attorney John F. Hawkins is claiming a rate of $400 per hour. Attorney Cliff
Johnson claims $425 per hour, and Attorney Brad Pigott is claiming a rate of $450 per hour. The
chart below summarizes the requested hourly rates of each of the Relator’s attorneys.
11
Chart 1. Requested Fees
Ecf Document
No. for Attorney
Declaration and
Itemized billing.
388-1
Attorney
Pre-verdict
Hours
Hourly Rate
John Hawkins
500.7
$400.00
$200,280.00
388-2
Cliff Johnson
299.9
$425.00
$127,457.50
388-3
Brad Pigott
26.2
$450.00
$ 11,790.00
TOTAL:
Number of
Hours times
Hourly rate
$339,527.50
Defendants herein contend that the Realtor is not entitled to any award of attorneys’ fees,
expenses, or costs, but if any fees, expenses, or costs are awarded, Defendants say they should be
limited as follows:
Chart 2. Defendants’ Suggested Fees and Expenses for Relator
Attorney
John Hawkins fee
Cliff Johnson fee
Brad Pigott fee
Expenses and costs
TOTAL:
Hours
Hourly Rate
443.05 hours at $300 plus 64 travel $300.00
hours at $150
38.1 hours at $300
$300.00
94 hours at $300
$300.00
$10,444.55 for Hawkins’ law firm
and $3,198.20 for Pigott’s law firm
Number of
Hours times
Hourly rate
$142,515.00
$ 11,430.00
$ 28,200.00
$ 13,642.75
$195,787.75
The general rule is that reasonable hourly rates for counsel are to be calculated according
to the prevailing market rates in the relevant community. In this case that would be the Gulfport,
Mississippi area or the Southern District of Mississippi. The three attorneys say that the case of
United States ex rel. Rigsby v. State Farm Fire & Cas. Co., sets the standard in the Southern
12
District of Mississippi for hourly attorneys’ fee rates in qui tam cases. United States ex rel.
Rigsby v. State Farm Fire & Cas. Co., 2014 WL 691500, at *1(S.D. Miss. 2014) (unreported).
Although this is an unreported case, and thus, lacking precedential value, the analysis by
Judge Ozerden of the attorney’s fee issue in that qui tam case, is informative. In Rigsby, Judge
Ozerden ruled, in 2014, that $400 per hour was a reasonable hourly rate to be awarded in a qui
tam case for legal work on the relators’ behalf by an attorney with two decades of trial
experience as a private practitioner. In Rigsby the attorneys, collectively, were awarded
$2,913,228.69 in fees and $303,078.89 for expenses, even though the jury verdict in that case
was for only $250,000.00. Id. at **19, 23. By comparison, the jury verdict in the case at bar was
$10,855,382.00 (over 40 times as much). Jury Verdict [doc. no. 383]. After trebling the
damages pursuant to 31 U.S.C. §3729(a), the award in Rigsby totaled $750,000.00 plus
$8,250.00 in civil penalties, for a total of $758,250.00. Id. at **19, 23. After trebling the
damages in the instant case, the total award was $32,566,146.00 in damages and $71,681 in
penalties for a total of $32,637,827.00. Judgment [doc. no. 409].
Relator’s attorneys say their experience compares favorably with that of the attorneys in
the Rigsby case, justifying an hourly rate at least commensurate with that of the Rigsby attorneys.
Additionally, say Aldridge’s attorneys, the attorneys’ fee award in Rigsby was six years earlier;
and, whereas the Rigsby case was litigated for eight years and the trial lasted eleven days, the
case sub judice, was adjudicated for thirteen years before it was tried to a jury and the trial lasted
eight-and-a-half weeks. These factors weigh in favor of an hourly rate that is at least as much as
that in Rigsby, according to the Relator’s attorneys here.
Defendants, on the other hand, point out that in Rigsby the government did not intervene
and take over prosecution of the case. The Relators, through their attorneys, were responsible for
13
conducting the litigation, including the trial. Also, the Relators’ attorneys in Rigsby were
awarded varying hourly fees ranging from $262 per hour for junior partners to $358 per hour for
senior partners. Only one attorney was awarded $400 an hour in that case, an attorney from
Washington, D.C., whose customary billing rate in the D.C. area was $600 per hour.
Judge Ozerden, in Rigsby, found that one of the Relators’ local attorneys, C. Maison
Heidelberg, had comparable years of experience to the D.C. attorney, but, although his billing
rate ranged from $250/hour to $450/hour (depending on a variety of circumstances, he said),
Heidelberg requested only $375 an hour in the Rigsby case. Despite his years of experience,
Heidelberg stated in his declaration in Rigsby, that his law office “would not have accepted the
case as lead counsel. Our firm did not possess the professional resources or expertise necessary
to litigate and try this case either as lead counsel or as sole counsel for the Relators.”
Heidelberg’s experience, then, is in a different category than that of the Relator’s
attorneys in the instant case. The Attorneys here did act as lead counsel for the Relator, and were
preparing to take the case forward had the government not intervened. Unlike Heidelberg, the
attorneys here possessed both the “professional resources” and “expertise” necessary to litigate
and try this case. The $375 award for Heidelberg in the Rigsby case is not determinative of the
hourly rate that should be awarded to any of the Relator’s counsel here.
Judge Ozerden also approved a rate of $124 an hour for a paralegal and for one attorney
whose work he described as resembling paralegal work.
Attorney John G. Corlew who prepared an affidavit in the case here under consideration
also prepared an affidavit in Rigsby. Attorney Corlew stated in Rigsby that “customary and
reasonable rates currently charged by litigation partners in Mississippi firms and/or regional
firms with offices in Mississippi are in the $400-$500 range.” Rigsby at *14. In this case too,
14
Attorney Corlew offers that “[f]or complex high stakes or high-risk litigation in the Southern
District of Mississippi, I believe that customary and reasonable rates currently charged by
litigation partners in Mississippi firms and/or regional firms with offices in Mississippi are in the
$400-$500 range.” Corlew Affidavit [doc. no. 388-6].
Joe Bradley (Brad) Pigott
Pigott graduated from the University of Virginia School of Law in 1980. Upon returning
to Mississippi, he specialized in civil litigation in the area of financial fraud. He became a
partner in two law firms in the Jackson, Mississippi area. Pigott was appointed by President Bill
Clinton as the United States Attorney for the Southern District of Mississippi, and he served in
that capacity from November 1994 to January 2001. The matters that he investigated and
prosecuted included criminal and civil litigation involving fraud against the United States
Government.
During his tenure as United States Attorney Pigott founded and chaired the Mississippi
Health Care Fraud Task Force. After ending his federal service, Pigott’s practice primarily
centered around FCA qui tam cases, such as the instant case, focusing mainly on Medicare fraud.
Pigott, according to his declaration, has personally filed or served as lead counsel in over a dozen
such cases in at least eleven states. Pigott has now practiced law for four decades, far longer
than the length of time any of the Relators’ lawyers in Rigsby had been practicing. Pigott is a
past member of Inns of Court, maintains an AV rating with a long-standing attorney rating
entity, and was selected as a Mississippi Bar Foundation Fellow. As a member of his current law
firm, Pigott charges and is paid $400 per hour for work in Mississippi on complex litigation
matters other than qui tam cases. Attorneys’ fees have usually been negotiated as part of a
settlement in most qui tam cases with which he has involved.
15
This court is of the opinion that $450 an hour, an amount slightly above that awarded in
Rigsby, is a reasonable hourly rate according to the prevailing market rates in the relevant
community for an attorney of Mr. Pigott’s background and years of experience, given the
complexities of the case and Pigott’s experience directly related to the case at hand. Pigott’s
experience, credentials and skill brought to this very complicated litigation validate the status
accorded him by Attorney Corlew in his affidavit, as falling within the upper echelon of trial
counsel in Mississippi. Corlew Affidavit [doc. no. 38806 ¶ 11]. This amount also falls within
the range of reasonable hourly rates articulated by Attorney Corlew in his affidavit.
Attorney Pigott, who expended fewer hours on this matter than the Relator’s two other
attorneys, is requesting payment at $450 per hour for 26.2 hours, or a total of $11,790.00 for his
pre-verdict legal work. This court awards this hourly amount.
Pigott has separately itemized his work on preparing and litigating the motion for
attorney’s fees, costs and expenses, requesting $450 per hour for 74.3 hours expended, or a total
of $33,435.00. This court awards this hourly amount.
James Clifton (Cliff) Johnson
Attorney Johnson is a 1992 graduate of the Columbia University School of Law. Other
than an academic year as a Professor of Law, and a Fulbright Scholar, Johnson has practiced law
in Mississippi continually since that time. He served as an Assistant United States Attorney in
the Southern District of Mississippi, concentrating entirely in the civil and criminal prosecution
of fraud against Medicare and other health care insurance programs of the United States. He
supervised and monitored numerous health care fraud investigations by federal agents. He then
practiced law in Jackson, Mississippi with the firm known at that time as Pigott, Reeves, Johnson
and Minor, specializing in the representation of qui tam relators in preparation and prosecution
16
of civil fraud cases under the False Claims Act (“FCA”) throughout the United States. Johnson
was inducted in 2019 as a Mississippi Bar Foundation Fellow. According to Johnson’s affidavit,
his law firm, then named Pigott & Johnson P.A., charged, and was paid $400.00 per hour for his
work in non-qui tam cases. As with Attorney Pigott, Johnson says he did not usually bill an
hourly rate in qui tam cases because the attorneys’ fees were generally part of the negotiated
resolution.
This court is of the opinion that $425 an hour, an amount slightly above that awarded to
senior partners in Rigsby, is a reasonable hourly rate according to the prevailing market rates in
the relevant community for an attorney of Mr. Johnson’s skill and experience, given the
complexities of the case sub judice, and Johnson’s experience litigating qui tam cases,
specifically. This amount also falls within the range of reasonable hourly rates for this
community articulated by Attorney Corlew in his affidavit.
Attorney Johnson, who drafted the initial Complaint and did much of the preliminary
work on the case before withdrawing as counsel, is requesting payment at $425 per hour for
299.9 hours, or a total of $127,457.50. This court grants this hourly amount.
John F. Hawkins
Attorney Hawkins is a 1993 cum laude graduate of Tulane School of Law. He has been a
litigator for over 25 years and has handled a variety of complex cases including cases involving
fraud and bad faith by insurance companies and other private entities. He has tried over two
dozen jury trials and numerous bench trials to verdict. Hawkins litigated a large variety of civil
cases as an associate with the law firm of Maxey, Wann and Begley, PLLC, including time as an
equity partner. He continued his practice with other firms before establishing the firm he now
owns and operates, Hawkins Law, P.C. He has an AV rating with Martindale-Hubbell and is a
17
fellow of the Mississippi Bar Foundation. Attorney Hawkins does not provide to this court his
customary hourly rate, but requests $400 per hour for his work on this case.
Hawkins does not have as much experience related specifically to qui tam cases, but has
years of extensive trial experience in other complex matters, and roughly the equivalent years of
experience to the attorney in the Rigsby case who was awarded $400 an hour. This court
observed the litigation skills exhibited by Hawkins during the trial of this case. His active
participation at trial clearly augmented presentation of the Government’s case.
This court is of the opinion that $400 an hour is a reasonable hourly rate according to the
prevailing market rates in the relevant community for an attorney of Mr. Hawkins’ s skill and
experience, given the complexities of the case. This amount falls within the hourly rates
articulated by Attorney Corlew in his affidavit.
Attorney Hawkins, who was involved with this case from its inception and was an active
participant in the trial, is requesting payment at $400 per hour for 500.7 hours, or a total of
$200,280.00. This court awards this hourly amount.
Prevailing qui tam relators are also entitled to an award of fess for time expended
preparing and litigating a motion for attorneys’ fees. Attorney Pigott has submitted separately
itemized fees for this work, which is summarized below.
Chart 3. Preparation of Attorneys’ Fee Motion and Application
Ecf Document.
No. for Attorney
Declaration and
Itemized billing
388-4
Attorney
Brad Pigott
Hours for
Attorneys’ fees
motion
preparation
74.3
Hourly Rate
Number of
Hours times
Hourly rate
$450.00
$ 33,435.00
Expense: data retrieval (disallowed)
$
TOTAL:
$ 29,720.00
18
2,284.45
Pigott says that Cliff Johnson left the firm in 2018 or 2019 and the firm had to incur
expenses of an Information Technology consultant to retrieve billing information relative to Cliff
Johnson in support of preparation of the fee application. The invoices totaled $2,284.45. The
expense for data retrieval is disallowed. This should be reflected as an item of overhead for the
law firm.
B. Reasonableness of Hours Claimed
The cumulative hours submitted by the Relators’ attorneys for pre-verdict legal work on
this case total 826.8 hours. The Defendants raise several objections to the number of hours
claimed. Defendants’ first argument is that hours claimed for work on unsuccessful claims
should be eliminated. This court has reviewed the billing statements submitted by Relator’s
counsel and can find no easily separable tasks with respect to claims that were not pursued by the
Government. Consistent with Fifth Circuit jurisprudence as stated in Longhi, this court will not
require counsel to do so. Moreover, the Relator’s attorneys say in their brief that they have
already excluded from their attorneys’ fee request many hours expended by them on matters not
pertaining to the cost report fraud which was the major focus of the Government’s case.
As a means of separating the unsuccessful claims from claims meriting payment of
attorneys’ fees, Defendants suggest that this court disallow all attorneys’ fees for work prior to
December 2013. This demarcation, they say would approximate the work on successful versus
unsuccessful claims, since work did not begin on the successful claims until that point in time.
This is not workable, however, since cost report fraud was a subject of the legal work from the
inception of this case, which included, among other things, the drafting and filing of the
Complaint and Amended Complaint, hiring a consultant to analyze the cost reports, and
19
reviewing that analysis. Relator is entitled to attorneys’ fees for this, and other legal work
performed prior to December of 2013.
Next, Defendants say the entries are vague and/or reflect block billing. They also say
that Relator’s attorneys did not exercise billing judgment because they do not show on their fee
application any entries written off. “Ideally, billing judgment is reflected in the fee application,
showing not only hours claimed, but also hours written off.” Walker v. United States HUD, 99
F.3d 761, 769 n.9 (5th Cir. 1996) (quoting Alberti v. Klevenhagen, 896 F.2d 927, 930 (5th Cir.
1990)).
This court will now discuss billing judgment. Attorney Hawkins states in his declaration
the following:
[I]n an effort to avoid petitioning for a fee award for work that may have been
duplicated or that may not have been critical to the development and litigation of
the case, I am not including certain hours in the fee request for the Relator. I have
conservatively included in this declaration only the hours which I performed that
contributed substantial value to the development, litigation and trial of the case. I
have been careful not to include hours that might be deemed to be unnecessary or
merely duplicative of the efforts of my co-counsel.
Hawkins Declaration [doc. no. 388-1 ¶10].
The Relator’s attorneys also state in their Memorandum brief that although significant
work was done on the case by paralegals, that time is not included in their fee application and
compensation for that time is not requested. Moreover, as stated earlier, the Relator’s attorneys
say in their brief that many hours spent on matters not pertaining to cost report fraud have been
excluded from their fee claim. This, they say, depicts billing judgment.
This court is satisfied that counsel have demonstrated sufficient billing judgment.
Defendants have singled out eighteen entries they claim to be vague, since the subject
matter of the communications is not included. [doc. No. 394 pp. 7-8]. See e.g., Louisiana
20
Power & Light Co. v. Kellstrom, 50 F.3d 319, 324 (5th Cir. 1995) (Hours may be reduced for
documentation that is vague or brief); Leroy v. Houston, 906 F.2d 1068, 1080 (5th Cir. 1990)
(Hours may be reduced for documentation that is “very brief” and “not illuminating as to the
subject matter”). The entries complained of include telephone conferences and emails between
attorneys, between the attorneys and Aldridge, or with the consultant, Rob Church. The
Relator’s lawyers reply that many of these entries arise from privileged communications between
co-counsel or between attorney and client, which do not have to describe the subject matter in
order to be presumed to be reasonable. These lawyers do not provide legal authority for this
proposition.
The Fifth Circuit Court of Appeals has found to be vague or insufficiently documented
such things as: “library research,” “analyzing documents,” and “phone interviews.” See Walker
v. U.S. Dept. of Housing and Urban Development, 99 F.3d 761, 773 (5th Cir. 1996). In
Louisiana Power & Light Co. v. Kellstrom, 50 F.3d 319, 326 n.11 (5th Cir. 1995), the Fifth
Circuit disallowed entries like “revise memorandum,” “review pleadings,” and “review
documents.” See also Leroy v. Houston, 906 F.2d 1068, 1080 (5th Cir. 1990) (disallowing
entries like “work on brief,” “continue work on brief,” and “review for oral argument”).
As noted, Defendants only point to 18 entries as insufficiently vague. Of those, one entry
(the Cliff Johnson entry of 2/11/13 for 7.6 hours) is being eliminated by this court due to block
billing. Although the other 17 entries complained of could be more specific, they are not as
vague as the examples listed in the cases above. In each instance where a telephone conference
or email is noted, the person on the other end of the communication is named by Aldridge’s
attorneys. In some instances, the subject matter of the communication is also stated. This court
is not convinced that the entries are so vague as to be disallowed. The one entry discussed under
21
this section that the court has found to constitute block billing is being disallowed. This court
will allow the other seventeen entries to which Defendant objects in this section on vagueness.
Defendants challenge another group of entries as work typically performed by paralegals,
such as issuance of subpoenas and arrangements for service. [doc. No. 394 pp. 8-9]. Defendants
allege this represents clerical work that should not be billed at attorneys’ rates. These subpoenas
duces tecum, drafted by the Relator’s attorneys at the behest of the Department of Justice,
concerned numerous documents and financial records, and required legal judgment. This court
recalls the hard-fought battles that erupted over the subpoenaed records. This was not clerical
work and will be allowed by this court.
Defendants next challenge 12 of the Relator’s attorneys’ billing entries as unreasonable,
duplicative, unnecessary, or unrelated. [doc. No. 394 p.10]. See Watkins v. Fordice, 7 F.3d 453,
457 (5th Cir. 1993). Defendants contend these entries include unnecessary travel, unnecessary
or redundant review of deposition transcripts, excessive amounts of time spent on the listed
tasks, and tasks related to other legal matters concerning the Relator. Defendants do not explain
how they contend the particular entries are insufficient. Legal work concerning the Relator
proved to be extremely relevant since motions were filed, objections were made, and lengthy
arguments ensued concerning evidence of the Relator’s alleged employment conduct and his
termination by one or more Defendants. This court has reviewed the questioned entries and
concludes they were all relevant to the current litigation at hand and the court does not discern
excessive time spent on these items.
Defendants also single out six entries as representing block billing by Attorney Cliff
Johnson. This court is persuaded that five of the six entries reflect block billing. Several tasks
are listed for each entry and the hours claimed for each entry represent large blocks of time, such
22
that this court cannot determine how much time was spent on each task. These entries should
have been broken down into components, so the court could have evaluated the reasonableness
of each task listed and the time claimed for it. This court, therefore, disallows the following:
Chart 4. Block billing disallowed
Attorney
Date
Hours
Cliff Johnson
2/11/13
7.6
Cliff Johnson
3/2/13
10.1
Cliff Johnson
3/7/13
5.8
Cliff Johnson
3/12/13
8.2
Cliff Johnson
3/13/13
7.2
Total Hours
Disallowed
38.9
Tasks Number of Hours times
Hourly rate
Prepare for Meeting with DOJ
Attorneys; Emails to and from
Hawkins and Church Re: Issues;
Phone Conference with Rob Church
Emails to and from James Aldridge
and John Hawkins; Further Revisions
of Draft Proposed Intervention
Complaint for DOJ Consideration
Further Work on Complaint in
Intervention Proposed Draft; Emails
to and from Aldridge, Church and
Hawkins; Emails to and from Morris
and Hawkins Re: DOJ Issues
Phone Conference with DOJ’s T.
Morris and A.Williams; Work on
Revisions
to
Complaint
in
Intervention; Emails to and from
Aldridge, Church and Hawkins
Emails to and from DOJ; work on
Complaint in Intervention; Creation
of Charts and Graphs for HHS/DOJ;
Phone Conference with DOJ’s Morris
and Williams
See Defendants’ Memorandum Brief [doc. no. 394 p. 11].
This court will disallow 38.9 hours of Cliff Johnson’s fee application.
Except for the hours excluded for block billing, this court finds the number of hours
claimed by the Realtors’ attorneys to be reasonable, and no other time is determined to be
23
excessive, duplicative, or inadequately documented. This court then determines the lodestar
amounts for these attorneys through trial to be as follows.
Chart 5. Lodestar Determination
Ecf Document
No. for Attorney
Declaration and
Itemized billing.
388-1
Attorney
Pre-verdict
Hours
John Hawkins
500.7
$400.00
$ 200,280.00
388-2
Cliff Johnson
261 (299.9 hours $425.00
$ 110,925.00
388-3
Brad Pigott
less 38.9 hours
disallowed)
26.2
Hourly Rate
$450.00
TOTAL:
Number of
Hours times
Hourly rate
$ 11,790.00
$ 322,995.00
III. ADJUSTMENTS UNDER JOHNSON
The lodestar amount of 322,995.00 is presumed to be reasonable, but may be adjusted
upward or downward based on evaluation of specific factors. Watkins v. Fordice, 7 F.3d 453,
459 (5th Cir.1993). Adjustments may be made to the fee award by applying the factors
enumerated in Johnson v .Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir. 1974). See also
Blanchard v. Bergeron, 489 U.S. 87, 94, 109 S.Ct. 939, 103 L.Ed.2d 67 (1989)(citing Johnson v.
Georgia Highway Express, Inc., supra). The twelve factors articulated in the Johnson case are:
(1) the time and labor required, (2) the novelty and difficulty of the issues, (3) the
skill required to perform the legal services properly, (4) the preclusion of other
employment, (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 nature and length of the professional
relationship with the client, and (12) awards in similar cases.
Giles v. General Electric Co., 245 F.3d 474, 490 n. 29 (5th Cr. 2001) (citing Strong v. BellSouth
Telecomms., Inc., 137 F.3d 844, 850 n. 4 (5th Cir. 1998)); Johnson, 488 F.2d at 717-19.
24
The lodestar need not be adjusted unless there is something exceptional about the case or
the representation. City of Burlington v. Dague, 505 U.S. 557, 562 (1992).
The Relator asks this court to grant a 30% upward adjustment to the lodestar amount.
Defendants oppose the adjustment.
Defendants oppose any upward adjustment, noting that there is a strong presumption that
the lodestar represents the reasonable fee, and the United States Supreme Court “has placed upon
the fee applicant who seeks more than that the burden of showing that ‘such an adjustment is
necessary to the determination of a reasonable fee.’” City of Burlington v. Dague, at 562
(quoting Pennsylvania v. Del. Valley Citizens’ Council for Clean Air, 478 U.S. 546,565 (1986).
Additionally, the lodestar may not be adjusted based on a Johnson factor that was already taken
into account during the initial calculation of the lodestar. Black v. Settlepou, P.C., 732 F.3d 492,
502 (5th Cir. 2013).
Defendants also claim that since this was a case in which the government intervened and
took over prosecution of the case, the Relator’s attorneys had a limited role. Defendants say they
were unable to find any case where the Relator received an upward Johnson adjustment when the
United States had intervened in the case and the Relator has not cited to any cases where the
Government intervened and an upward Johnson adjustment was made.
In reviewing the Johnson factors this court agrees with the statement below by Relator’s
counsel that most of the factors are inapplicable here.
There was nothing “undesirable” about undertaking the Relator’s case.
That representation did not preclude other professional work. There is nothing
exceptional about a prior professional relationship between the Relator and counsel
which could justify any lodestar adjustment. No particular “time limitations” were
imposed in this case (apart from the foregoing of all attorney compensation
throughout a thirteen-year period).
Relator’s Memorandum [doc. no. 389 p. 13] (footnotes omitted).
25
This court has already considered these Johnson factors in making its lodestar
determination: 1) the attorneys’ professional time required; (2) the skill required for this
case; (3) the customary fee charged in the relevant legal market for such services; and (4)
the experience, reputation, and ability of the attorneys involved. Johnson at 717-19.
The Relator’s attorneys contend that there are some exceptional aspects of this litigation
that should be considered relative to three of the Johnson factors, that would justify an upward
adjustment. These attorneys say they are entitled to the upward adjustment of 30% based on
these factors: (a) the amount involved, and the results obtained; (b) novelty and difficulty of the
issues; and (c) awards in similar cases.
The Relator claims that the high degree of success in this case would not have been
possible but for the efforts of the Relator, his attorneys and their expert consultant, Robert
Church. The jury returned a verdict in this case of over ten million dollars ($10,000,000.00) and
the judgment was over thirty million dollars ($30,000,000.00) after the court imposed treble
damages and penalties as required by § 3729 of the FCA. The Relator contends that the amount
involved, and the results obtained justify the 30% adjustment sought.
The next factor, the novelty and difficulty of the issues in the case, also justifies an
adjustment, according to the Relator. The Relator notes the thirteen-year history of the litigation,
the eight-and-a-half weeks required to conduct the trial of the case, and the complex verdict form
that was required, as evidencing the novel and difficult nature of the case. This too, says the
Relator, is an exceptional aspect of this litigation justifying an adjustment.
Thirdly, the Relator asks this court to look at analogous awards in similar cases and cites
to the court United States ex rel. Garibaldi v. Orleans Parish Sch. Bd., 46 F.Supp.2d 546 (E.D.
La. 1999), vacated on other grounds, 244 F.3d 486 (5th Cir. 2001), cert. denied, 534 U.S. 1078
26
(2002), which resulted in a final judgment of $22,899,856.00 for the False Claims Act portion of
the case. Id. at 551-52 & 572. The Garibaldi court described the legal issues in the case as novel
and challenging, largely because there was very little Fifth Circuit precedent on many of the
questions presented by the case. That district court noted that very few qui tam lawsuits are
successfully litigated beyond the early stages. Id. at 570.
As in the case sub judice, a significant monetary award was won for the public treasury in
the Garibaldi case, supra. Relying largely on the two previous Johnson factors discussed
(amount involved and the novelty and difficulty of the issues) the Garibaldi court increased the
Relator’s attorneys’ fees by 50% above the lodestar amount and awarded to them a total of
$353,042.55. That court called the case one of those “rare” and “exceptional” cases that merits
an increase in the lodestar. Id. at 570. As Defendants in the instant case note in their brief,
however, the United States did not intervene in the Garibaldi case; so, unlike the case at hand,
the relators in Garibaldi were entirely responsible for every aspect of the litigation.
As previously stated, the court's application of the Johnson factors is limited to those
factors that have not already been addressed through the court's calculation of the number of
reasonable hours and the hourly rate of pay per attorney. Migis v. Pearle Vision, Inc., 135 F.3d
1041, 1047 (5th Cir.1998), Watkins v. Fordice, 7 F.3d 453, 459 (5th Cir. 1993). The Fifth Circuit
has warned courts that the first factor (the time and labor required) and the seventh factor (time
limitations imposed by the client or the circumstances) are especially susceptible to “double
counting.” Walker v. US. Dept of Housing and Urban Development, 99 F.3d 761, 771-72 (5th
Cir. 1996). The Fifth Circuit has also held that the novelty and complexity of the issues (factor
two), the special skill and experience of counsel (factor three), the quality of representation
27
(factor nine), and the results obtained from the litigation (factor eight) are presumably fully
reflected in the lodestar amount. Shipes v. Trinity Industries, 987 F.3d 311, 322 (5th Cir. 1993).
“Although upward adjustments of the lodestar figure are still permissible, such
modifications are proper only in certain ‘rare’ and ‘exceptional’ cases, supported by both
‘specific evidence’ on the record and detailed findings by the lower courts.” Pennsylvania v.
Delaware Valley Citizens' Council for Clean Air, 478 U.S. 546, 565, 106 S.Ct. 3088, 3098, 92
L.Ed.2d 439 (1986) (citations omitted). The question before this court, then, is whether this case
is one of the rare and exceptional cases that merits an increase in the lodestar.
This court acknowledges that there were some extraordinary aspects to this litigation.
FCA qui tam litigation normally involves complex issues; however, the complexities
surrounding the issues in the case sub judice were compounded by the presence of a privatelyowned Critical Access Hospital, and an owner who also operated many related businesses. A
number of the issues presented were matters of first impression. Although the novelty and
difficulty of a qui tam case, generally, was a factor considered by this court in making its
determination of reasonable hourly rates for the Relator’s attorneys, the additional convolutions
of this particular qui tam case were not factored in with that assessment. The span of time
covered by the fraudulent activity, the sheer length of the trial, the hard-fought, protracted nature
of the litigation, and the complicated verdict form required, attest to the extraordinary difficulty
of the case.
The degree of success obtained in this litigation also cannot be overlooked. The verdict
obtained represents a significant result won for the public treasury. Very few similar awards can
be found. The Relator directs us to Garibaldi, supra. In that case, the judgment as later altered
by the court, was over twenty-two million dollars. The attorneys’ fee award in that case was
28
$353,042.55 after being adjusted by 50%, as compared to the instant case, where this court has
determined the lodestar amount to be $322,995.00 before consideration of any adjustment.
This court is persuaded that this case falls into that category embracing some
extraordinary aspects that entitle the Relator to an adjustment. This court recognizes that the
Government took the lead in prosecuting this case once it intervened and, therefore, does not
agree that these attorneys are entitled to a 30% adjustment. Despite the Government’s
intervention, however, this court is aware that the Relator’s attorneys continued to play a
significant role in the case, up to and during the trial. The Relator’s attorneys were assigned
certain tasks by the Department of Justice, including preparation of subpoenas duces tecum and
procuring financial documents. Attorney Hawkins was an active participant in the trial,
examining and cross-examining witnesses, briefing, and arguing motions and evidentiary
matters. Hawkins made a meaningful contribution to the conduct of the case, and did so with
consummate skill, consistent with Attorney Corlew’s description, of the Relator’s attorneys in
his declaration, including Hawkins, as within the upper echelon of attorneys in this area.
For the reasons discussed, this court hereby makes a fifteen percent (15 %) adjustment
upward to the lodestar amount for a total of $371,444.25 ($322,995.00 plus $48,449.25), broken
down as follows:
Chart 6. Johnson Factor Adjustment
Attorney
John Hawkins
Pre-verdict
Hours
500.7
$400.00
Lodestar
Amount
$ 200,280.00
Cliff Johnson
261 (299.9 hours $425.00
$ 110,925.00
$ 16,638.75
$ 11,790.00
$ 1,768.50
Brad Pigott
less 38.9 hours
disallowed)
26.2
Hourly Rate
$450.00
29
Plus 15%
Adjustment
$ 30,042.00
$ 48,449.25
Totals
$ 322,995.00
$ 371,444.25
IV. TRAVEL TIME
The Relator’s attorneys ask for compensation for travel time at one-half their normal rate
for legal work. Attorney Cliff Johnson traveled to Philadelphia, Pennsylvania in 2013 to meet
with a cost report expert. Attorney John Hawkins was required to travel back and forth from
Jackson, Mississippi to Gulfport, Mississippi for the trial of this case, which lasted for almost
nine weeks. Defendants object generally to the attorneys’ travel time as unnecessary, but do not
provide specific reasons for their objections. This court notes that it was Defendants herein who
filed a motion to have this case transferred from the Northern Division to the Southern Division
of the United States Court for the Southern District of Mississippi. This court granted that
motion, necessitating that the trial be conducted in Gulfport, Mississippi rather than in Jackson,
Mississippi, thus requiring Hawkins to make the weekly one-way three-hour commute.
This court finds these travel hours to have been reasonably required, and thus
compensable at one-half the attorneys’ normal hourly rate for legal work. See, e.g., Champion v.
ADT Sec. Servs., 2010 U.S. Dist. 16 LEXIS 121012, *23 (E.D.Tex. 2010); Lewallen v. City of
Beaumont, 2009 U.S.Dist. LEXIS 62503 *29 (E.D.Tex. 2009). In the context of fee-shifting,
compensating travel time at 50% of actual time is a common practice within the Fifth Circuit.”
Id. at *29, citing In re Babcock, 526 F.3d 824, 827-28 (5th Cir. 2008) and Watkins v. Fordice, 7
F.3d 453, 459 (5th Cir. 1993). This travel time and compensation are summarized below:
30
Chart 7. Travel Time.
Ecf Document.
No. for Attorney
Declaration and
Itemized billing.
388-1
Attorney
Travel Hours
One-half Hourly
Rate
John Hawkins
73
$ 200.00
$14,600.00
388-2
Cliff Johnson
13.1
$ 212.50
$ 2,762.50
TOTAL:
Number of
Hours times
Hourly rate
$17,362.50
V. EXPENSES FOR RELATOR’S EXPERT
The Relator is asking this court to award $134,750 for the fees of Robert D. Church, an
expert consultant retained by the Relator. Church’s declaration [doc. no. 388-11] says he spent
539 hours on this matter from October of 2009 to August of 2013. Also included with the
documentation of this expert’s work and credentials are: (1) a biography for Robert D. Church
[doc. no. 388-12]; (2) an itemization of the work done and time expended [doc. no. 388-13]; (3)
detailed list of files reviewed and analyzed [doc. no. 388-14]; and (4) two power-point style
documents prepared by Church to assist the attorneys in this case [doc. no. 388-15] [doc. no.
388-16].
Defendants say this court should not award any amount for the expenses of Church’s
bills. First, Defendants say Church was not called as an expert witness at trial nor disclosed to
Defendants, and his assistance was unnecessary. The Defendants do not challenge Church’s
credentials or his hourly rate. 10
Church’s credentials are chronicled in his declaration filed with this court [doc. no. 388-11]. The
Relator also includes the following in his Reply brief:
Mr. Church, a former Alabama Medicaid Commissioner, also brought experience as a former
CFO of a major Medicare and Medicaid managed care corporation, as Vice President of a major
health insurance plan, and as a health care fraud analyst whose work during over two decades
“identified and caused the recovery of over $2.4 Billion in mis-spent federal and state health care
10
31
The Relator responds that prior to 2015, the United States had not decided whether to
intervene in this case. Until the United States made that intervention decision, the Relator had to
prepare for litigating the entire case. Therefore, it was reasonable and necessary, according to
the Relator’s attorneys, to engage their own cost report analyst. This court is well aware of the
complex nature of the cost reporting fraud in this case for which the jury found these defendants
liable. In addition to preparing to litigate the case, the Relator’s attorneys say it was also
necessary to gather information for the benefit of any government expert.
This court finds that retaining a cost report analyst was reasonable and necessary and that
Church had more than adequate credentials.
Defendants next challenge the hours claimed to have been expended by Church on this
matter as excessive and unreasonable. Defendants also allege that the nature of Church’s billing
entries cast doubt on the credibility of those entries.
Defendants state:
Of Mr. Church’s 64 billing entries, 20 claim that he spent more than 10 hours on
this case in a day, including entries of 18.75, 16.75, 16.5, 14.8 (twice), 14.4, 14.2,
and 14 hours in a single day. (See Doc. No. 388-13). Even more incredibly, the
records contain two entries on September 4, 2010, and two entries on September 5,
2010, which add to exactly 24 hours for each day. Thus, Mr. Church claims to
[have] worked on this case for 48 consecutive hours, in addition to 11.8 hours
worked the previous day.
Memorandum brief [doc. no. 394 p. 14].
funds.” … Mr. Church charged the Relator at an hourly rate of $250.00, which he affirms to be
his customary rate across the country for such work, and is at the “‘low end’ of a typical and
customary hourly rate for such analytical work by consultant(s) who have credentials and
experience in health care fraud matters comparable to [Church’s].” Id. at ¶ 6. The Defendants in
their Opposition do not contest the reasonableness of that hourly rate for Church’s work in this
case.
Relator’s Rebuttal Memorandum [doc. no. 413 p.14 fn. 24]
32
Although The Relator states in his memorandum brief that Church often worked sixteen
to eighteen hours per day, the above examples give pause to this court, especially the 24-hour
workdays. Church submitted a “supplementary declaration” [doc.no. 413-1] and an “amended
time record” [doc. no. 413-2] correcting the two dates he had entered incorrectly that made it
appear he had worked two 24-hour days. After the corrections, the time records reflect that Church
did not work any more than 14.80 hours 11 on the days at issue. Such mistakes of record-keeping
are nonetheless troubling.
This court, though, cannot overlook the tremendous volume of work evidenced by the
very detailed index of the documents Church “read, reviewed, analyzed, investigated, detailed
compared and presented…” [doc no. 388-14]. The index consists of over sixty single-spaced
pages of documents in fine print. [doc. no. 388-14]. The power point-type presentations
prepared by Church and filed with this court are also proof of Church’s extensive analysis of
these issues.
This court concludes that Church is entitled to most of the hours claimed, but the hours
will be adjusted based on the instances outlined by the Defendants above. First, this court
subtracts 48 hours from Church’s total – the 24 hours shown on his original itemized statement
for September 4, 2010 (14.80 hours plus 9.20 hours) and the 24 hours shown on his original
In his Reply brief the Relator explains the error and the corrections concerning the 24-hour workdays as
follows:
Two separate time entries appear for September 4, 2010 (one for 14.80 hours, and the other for
9.2 hours). Two separate entries also appear for September 5, 2010 (one for 9.2 hours and the
other for 12.70 hours). Ibid. As he has now determined, the itemized 14.80 hours were devoted
to this case on September 3, 2010 (rather than September 4), and the itemized 11.30 hours were
devoted on September 6, 2010 (rather than September 5). The maximum number of hours Church
worked during any of those four days was therefore 14.80 hours. Attached as Exhibit 1 to this
Rebuttal is a Supplementary Declaration by Mr. Church, making those corrections through
Exhibit A thereto.
Relator’s Reply [doc. no. 413 p. 14 fn. 26]
11
33
itemized statement for September 5, 2010 (12.70 hours and 11.30 hours). Next, this court
reduces the hours claimed for the 3 entries where Church claims to have worked more than 15
hours in a single day -- 16.75 hours on June 5, 2010; 18.75 hours on July 17, 2010; and 16.5
hours on November 1, 2011 – to reflect 10 hours per day, a reduction of 22 hours. See Church’s
Time Itemization [doc. no. 388-13].
This court reduces the 539 hours for which the Relator seeks payment by 70 hours, to
469 hours at $250.00 per hour, or $117,250.
Defendants also criticize the block billing by Church. Church is a consultant, not an
attorney. The cases relied upon by the Defendants discuss block billing by attorneys, not experts
or consultants. There is a paucity of cases analyzing experts’ fees in the context of the FCA or
other fee-shifting provisions.
The analysis of expert expenses done by a federal district court in South Dakota,
provides some assistance. In U.S. ex rel. Greendyke v. CNOS, P.C., an unreported FCA case, the
court said the Relator did not specifically explain the services provided by his expert, though the
expert’s statement of services said she was retained for “Compliance Analysis” and that she was
involved in reviewing documents provided by the Defendant to the Government. U.S. ex rel.
Greendyke v. CNOS, P.C., No. CIV 04-4105, 2007 WL 2908414 (D.S.D. Sept. 27, 2007).
The court there denied the Relator’s request for expert fees, saying, “the Relator has not
provided the Court with her qualifications or the reasons for seeking her consulting services. It is
reasonable that Relator's counsel would require assistance in document review in this case, but
Relator has not met his burden of proof of the reasonableness of these expert expenses.” Id., at
*6.
34
While cases that denigrate block billing by attorneys may not directly apply to experts,
the work performed by an expert must be sufficiently documented to allow the court to make an
assessment whether the expenses claimed are reasonable. The party seeking the expert expenses
has the burden to prove the reasonableness of the expert expenses claimed. See also Neal v.
Honeywell, 191 F.3d 827, 833–834 (7th Cir.1999) (equating attorneys' fees and costs provisions
of the Act to those of 42 U.S.C. § 1988)); United States ex rel. Garibaldi v. Orleans Parish
School Bd., 46 F.Supp.2d 546, 567 (E.D.La.1999), vacated on other grounds, 224 F.2d 486 (5th
Cir.2001), cert. denied, 534 U.S. 1078 (2002) (Expenses under the Act includes such things as
“expert fees, attorney travel costs, and copies of charts used at trial”).
In U.S., ex rel. Abbott-Burdick v. Univ. Med. Assocs., the Sixth Circuit Court of Appeals
said: “The relators, by and through the deposition testimony of counsel, fully explained the
services rendered by these expert witnesses to the satisfaction of the undersigned.” U.S., ex rel.
Abbott-Burdick v. Univ. Med. Assocs., No. 2:96-1676-12, 2002 WL 34236885, at *24 (D.S.C.
May 23, 2002). That court awarded the full amount requested by the relators for the expert
witness fees. The court awarded to the relators total costs and expenses in the amount of
$242,608.4 plus attorneys’ fees in the amount of $2,057,701.60. Id. at *24.
This court is persuaded that the Relator here has shown that Church has sufficient
credentials and has explained to the court the nature of the work performed by Church. The
billing entries, as corrected, together with the index of documents examined and analyzed, and
the power point type documents, prove the reasonableness of the amount requested, except as
already reduced by the court. Moreover, in 2009 through 2013 when Church was performing his
cost report analysis and other work, the Relator did not know if the Government would
intervene, and it was necessary for the Relator and his attorneys to prepare to litigate this lawsuit.
35
The United States did not make its intervention decision until 2015, almost nine years after the
Relator filed his Complaint.
The FCA provides that a relator who brings an FCA case in which the United States
intervenes “shall also 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.
Reasonable litigation expenses include fees reasonably charged by qualified experts engaged to
assist relators and their attorneys in the analysis of technical issues relevant to an FCA case. See,
e.g., Becker ex rel. Becker v. Tools & Metals, Inc., 2013 U.S.Dist. LEXIS 187829 *18 (N.D.
Tex. 2012)(FCA qui tam case); Garibaldi, supra, at 567 (E.D.La.) (qui tam case). See also
Alcatec, LLC v. United States, 100 Fed. Cl. 502, 528-29 (Fed. Claims Ct. 2011), aff’d 471 Fed.
Appx. 899 (Fed. Cir. 2012). See also Rigsby, supra, at **61-67 (relator awarded over
$120,000.00 for amounts incurred by the relators to pay third-party non-attorney experts).
This court approves the expert expenses requested by the Realtor in the amount of
$117,250. 00.
VI. OTHER EXPENSES
The only objection stated by Defendants to the Relator’s request for other expenses is that
there are duplications of the requests for mileage. The Relator acknowledges that in the
itemization of out-of-pocket expenses by Attorney Hawkins’ law firm there is a “doublecounting” of some expenses. The original Motion included requests for both “mileage” charges
(in the amount of $1,843.07, at $.50 cents per mile) and payments for “fuel expense” in the
amount of $495.75, which was duplicative.
36
The Relator has removed the request for the $495.75 fuel expense. There is no longer
duplication of this expense, and this court approves the other expenses as requested and as listed
below.
Chart 8. Expenses
Ecf
Attorney
Document.
No.
388 and John Hawkins
388-1
388 and
Cliff Johnson
Description of Expenses
$12,088.08 (less $495.75)
Totals
$11,592.33*
388-2
388 and
388-3
Brad Pigott
$350 filing fee
$200 process service
$363.75 Relator’s deposition
$1,010.00 airline and hotel for Philadelphia
meeting with DOJ expert for Johnson and
Church
$1535.45 and $749.00 disallowed as overhead
TOTAL:
$ 1,923.75
$13,516.08
*The $495.75 originally requested for fuel expense has been deleted. Mileage is being paid at
$.50 cents per mile.
VII. CONCLUSION
The Relator’s Motion for Award of Attorney’s Fees, Litigation Expenses and Costs [doc.
no. 388] is granted in part and denied in part. The Relator is granted attorneys’ fees,
expenses, and costs but only to the extent and in the amounts stated herein. The total awarded by
this court for fees, expenses, and costs is $553,007.83. The adjusted and final amounts
approved by this court to be paid by the Defendants jointly and severally, are as follows:
37
Chart 9. Total Fees and Expenses Awarded
Category
Amount
Lodestar Amount for Legal Work by all 3 attorneys pre- $322,995.00
verdict
Value of 15% upward adjustment
$ 48,449.25
Attorneys’ travel time (½ hourly rates) (Johnson and $ 17,362.50
Hawkins)
Lodestar Amount for Attorney Pigott’s time in preparing and $ 33,435.00
litigating motion for fees/expenses 74.3 hours
Litigation Expenses required to pay Robert Church
$117,250.00
Remaining litigation expenses and costs by Pigott and $ 13,516.08
Hawkins (after $495 removal of fuel expense for Attorney
Hawkins)
Total
$553,007.83
SO ORDERED AND ADJUDGED, this 30th day of March, 2022.
__s/ HENRY T. WINGATE____________
UNITED STATES DISTRICT JUDGE
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