American Zurich Insurance Co. v. Sandra Jasso

Case: 13-51097 Document: 00512900336 Page: 1 Date Filed: 01/13/2015
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 13-51097 United States Court of Appeals
Fifth Circuit
FILED
AMERICAN ZURICH INSURANCE COMPANY, January 13, 2015
Lyle W. Cayce
Plaintiff-Appellant Cross-Appellee Clerk
v.
SANDRA JASSO, Beneficiary of Hilario Jasso, Deceased,
Defendant-Appellee Cross-Appellant
Appeals from the United States District Court
for the Western District of Texas
USDC No. 7:12-CV-7
Before STEWART, Chief Judge, BENAVIDES, and OWEN, Circuit Judges.
PER CURIAM:*
After exhausting its state administrative remedies in Texas, Plaintiff-
Appellant and Cross-Appellee American Zurich Insurance Company (“Zurich”)
filed suit in district court seeking reversal of a decision of an appeals panel
(“Appeals Panel”) for the Texas Department of Insurance, Division of Workers’
Compensation (“DWC”) finding Defendant-Appellee and Cross-Appellant
Sandra Jasso (“Appellee” or “Sandra Jasso”) entitled to death benefits. The
* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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district court denied Sandra Jasso’s motion to dismiss for lack of subject matter
jurisdiction. Zurich then filed a motion for summary judgment, and Sandra
Jasso filed a motion for partial summary judgment. Affirming the decision of
the Appeals Panel, the district court denied Zurich’s motion but granted
Sandra Jasso’s motion. Counsel for Sandra Jasso filed a motion for attorney’s
fees, which the district court denied in part for various reasons. Zurich
appealed the denial of its motion for summary judgment and the grant of
Sandra Jasso’s motion for partial summary judgment. Sandra Jasso cross-
appealed the denial of her motion to dismiss for lack of jurisdiction and the
partial denial of her attorney’s fees. For the reasons stated herein, we affirm
the district court in all respects.
I. FACTUAL AND PROCEDURAL HISTORY
On September 14, 2011, a contested case hearing officer for the Texas
Department of Insurance determined that Hilario Jasso (“Jasso”) sustained a
compensable injury on July 20, 2010, that resulted in his death, entitling
Sandra Jasso to death benefits under the Texas Labor Code. The hearing
officer deemed the injury compensable because Jasso was acting in the course
and scope of his employment with DCP Midstream (“DCP”). Zurich, DCP’s
insurer, appealed the decision of the hearing officer to the Appeals Panel,
which did not issue a decision within forty-five days of the appeal, causing the
decision of the hearing officer to become final on December 19, 2011, pursuant
to Tex. Lab. Code § 410.204(c). Zurich then filed the instant case, seeking a
determination that Jasso was not acting in the course and scope of his
employment with DCP at the time of the accident.
Jasso worked for DCP as a field supervisor based at DCP’s Fullerton
office on the date of his death. Jasso’s job was to oversee field operations, which
included scheduling employees, overseeing time off and vacation, and ensuring
that all DCP’s engines in the gas extraction and pipeline operations divisions
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were running. As part of his job, DCP issued Jasso a cell phone, laptop
computer, and a company truck. The truck was not to be used for personal
purposes. DCP also provided Jasso with a fuel card for the truck but required
Jasso to pay income tax on the value of the use of the company truck to
commute to and from work. DCP’s logo was on the outside of Jasso’s truck.
DCP gave Jasso discretion to travel either to the Fullerton office or one of the
field locations each day. Regardless of whether he traveled to the Fullerton
office or a field location, Jasso would travel out of Odessa along Highway 385
North.
On July 19, 2010, Jasso took off work for a wellness physical, which was
encouraged by DCP so its employees would qualify for an insurance discount.
On the morning of July 20, 2010, Jasso returned to his physician’s office to
have his blood drawn for one more test as a part of the physical. He left his
house for the physician’s office later than he would normally leave for work.
Jasso received and placed numerous phone calls to various DCP employees
before having his blood drawn. Jasso left the physician’s office and proceeded
to an off-site work location known as the Love Discharge Facility to meet a
DCP employee to help make a decision about laying certain pipeline at that
site. On his way to the Love Discharge Facility, Jasso’s truck was struck at an
intersection on Highway 385 by a vehicle that ran a stop sign. This intersection
was along the same route as Jasso’s daily commute to and from work. Jasso
died as a result of the accident.
II. DISCUSSION
A. Jurisdiction and Abstention
We first consider whether the district court had subject matter
jurisdiction. This court reviews an interlocutory appeal of a denial of a motion
to dismiss for lack of subject matter jurisdiction de novo. E.I. DuPont de
Nemours & Co. v. Sawyer, 517 F.3d 785, 792 (5th Cir. 2008). Tex. Lab. Code §
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410.251 provides that “[a] party that has exhausted its administrative
remedies under this subtitle and that is aggrieved by a final decision of the
appeals panel may seek judicial review[.]” Diversity jurisdiction in federal
court is allowed for “citizens of different States” for “all civil actions where the
matter in controversy exceeds the sum or value of $75,000, exclusive of
interests and costs[.]” 28 U.S.C. § 1332(a).
Sandra Jasso makes two arguments that the district court did not have
jurisdiction: (1) the enactment of the Texas Workers’ Compensation Act of 1989
(“1989 Act”) removed the basis for jurisdiction for federal courts to review final
decisions of an appeals panel for the DWC, and (2) the amount in controversy
was not greater than $75,000, as the district court case was an appeal of an
agency finding with no pleading for monetary recovery.
Counsel for Sandra Jasso cites no caselaw to support the contention that
the 1989 Act had any effect on federal judicial review of decisions of the DWC.
In fact, two courts in this circuit have recently stated that subject matter
jurisdiction extends to Texas Workers’ Compensation Act cases where the
plaintiff has exhausted administrative remedies. See Rubell v. Gen. Dynamics
Corp., No. 7:10-CV-00176-O, 2011 WL 477175, at *1 (N.D. Tex. Jan. 20, 2011);
England v. Liberty Ins. Corp., No. H:10-1937, 2011 WL 3567084, at *2 (S.D.
Tex. Aug. 12, 2011). The court in Rubell noted that “[a]lthough it is unusual
to find a worker’s compensation case filed in Federal Court because it is a state
statutory action, the court does have subject matter jurisdiction so long as
complete diversity and the requisite amount in controversy are established.”
2011 WL 477175, at *1. In denying an insurance company’s motion to dismiss
for lack of subject matter jurisdiction, the court in England stated, “there is no
Texas law to suggest that this court’s jurisdiction ought to be constrained after
an initial determination by the DWC that benefits were due.” 2011 WL
3567084, at *2. The England court concluded that “because . . . a Texas state
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court would hold that it has jurisdiction, this court . . . has jurisdiction over
this diversity action.” Id.
As noted in Rubell, this type of suit is not common in federal court, but
we agree it is not necessarily improper. 2011 WL 477175, at *1. 1 Tex. Lab.
Code § 410.251 allows judicial review after exhaustion of administrative
remedies for parties aggrieved by a final decision of an appeals panel of the
DWC. The Texas Legislature, when attempting to limit jurisdiction, makes
this intent clear in the statute. See, e.g., Chapman v. Commonwealth Land
Title Ins. Co., 814 F. Supp. 2d 716, 721 (N.D. Tex. 2011) (finding the Texas
Legislature not using the term “exclusive jurisdiction” in the Texas Title
Insurance Act “was not just mere oversight because the Texas Legislature has
demonstrated that it knows how to confer such jurisdiction when it desires by
carefully selecting the wording of the statute.”); In re Entergy Corp., 142
S.W.3d 316, 323 (Tex. 2004) (holding that the Texas Legislature limited
jurisdiction to the Public Utilities Commission for disputes about rates,
operations, and services of an electric utility by stating that “the Commission
has exclusive original jurisdiction over [these issues].” (citing Tex. Util. Code §
32.001 (West 2007))). While Chapman and Entergy Corp. each addressed
exclusive jurisdiction of Texas administrative agencies, each case is supportive
of the idea that the Texas Legislature does, in certain situations, put limits on
what tribunals can hear certain disputes. The Texas Legislature in Tex. Lab.
Code § 410.251 included no language attempting to limit appeals from the
1 The district court’s jurisdiction is also not limited by 28 U.S.C. § 1446(c), which bars
removal of state court actions arising under workers’ compensation laws of that state, as this
case was originally filed in the federal district court. See Horton v. Liberty Mut. Ins. Co., 367
U.S. 348, 352 (“Congress used language specifically barring removal of such cases from state
to federal courts [but] left unchanged the old language which . . . specifically permits civil
suits to be filed in federal courts in cases where there are both diversity of citizenship and
the prescribed jurisdictional amount.” (emphasis added)).
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DWC to only state courts. A Texas state court would have jurisdiction here,
and the district court accordingly had diversity jurisdiction. Nothing in the
1989 Act or its subsequent judicial interpretation indicates otherwise. Thus,
Appellee’s argument here fails.
Counsel for Sandra Jasso also argues there is an insufficient amount in
controversy. This argument is without merit. We have stated:
[U]nder the Texas workers’ compensation scheme, if the insurance
company claims an amount supporting jurisdiction, ‘federal
jurisdiction exists unless the insured denies the allegation that he
will seek more than [the jurisdictional minimum] in the court
action and makes an affirmative claim for compensation for a sum
which does not exceed [the jurisdictional minimum]. If the
employee counterclaims for less than the minimum jurisdictional
amount, ‘it then becomes clear to a legal and mathematical
certainty that the amount in controversy is less than the
jurisdictional requisite.’
Nat’l Union Fire Ins. Co. of Pittsburgh v. Russell, 972 F.2d 628, 630 (5th Cir.
1992) (citing Hardware Mut. Cas. Co. v. McIntyre, 304 F.2d 566, 569−70 (5th
Cir. 1962)). Zurich—seeking a reversal of the decision of the Appeals Panel—
claims the amount in controversy is over $75,000. Appellee does not actually
claim that the death benefits will total less than $75,000 but attempts to rely
on the fact that the remedy Zurich prayed for was not an actual damages
amount measured in dollars. However, this technicality does not mean there
is an insufficient amount in controversy. Although the total amount of
damages is uncertain now, the DWC has found that Sandra Jasso is entitled
to death benefits, and competent evidence in the record indicated the amount
could total over $1 million. In fact, counsel for Sandra Jasso argued the
reduction of his attorney’s fees was improper because the amount involved “is
astronomical” due to the death benefits entitling her to receive $750 per week
for life. Her life expectancy is thirty-five more years. Obviously, the total
amount of death benefits expected to be paid exceeds $75,000. Thus, there is
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a sufficient amount in controversy to satisfy 28 U.S.C. § 1332(a), and the
district court had proper subject matter jurisdiction.
Next, counsel for Appellee argues in the alternative that even if the
district court did have subject matter jurisdiction over this case, it nonetheless
should have abstained from exercising its jurisdiction under Burford v. Sun
Oil Co., 319 U.S. 315 (1943), because adequate state remedies exist for this
dispute, namely, the DWC appeals process. Burford abstention operates as
such:
Where timely and adequate state-court review is available, a
federal court sitting in equity must decline to interfere with the
proceedings or orders of state administrative agencies: (1) when
there are ‘difficult questions of state law bearing on policy
problems of substantial public import whose importance
transcends the result in the case then at bar’; or (2) where the
‘exercise of federal review of the question in a case and in similar
cases would be disruptive of state efforts to establish a coherent
policy with respect to a matter of substantial public concern.’
New Orleans Pub. Serv., Inc. v. Council of City of New Orleans, 491 U.S. 350,
361 (1989) (citing Colorado River Water Conservation Dist. v. United States,
424 U.S. 800, 814 (1976)).
Contrary to Appellee’s stance, “[w]hile Burford is concerned with
protecting complex state administrative policies from undue federal influence,
it does not require abstention whenever there exists such a process, or even in
all cases where there is a ‘potential for conflict’ with state regulatory law or
policy.” Id. at 362. This court examined Burford abstention in relation to the
Texas Workers’ Compensation scheme in St. Paul Ins. Co. v. Trejo, 39 F.3d 585
(5th Cir. 1994). The court in Trejo found Burford abstention inapplicable
because the lawsuit did not involve a state administrative proceeding and did
“not seek to interfere with Texas’ worker’s compensation system.” Id. at 589.
The declaratory judgment action in Trejo, which sought interpretation of a
settlement agreement entered into after the claimant received an award from
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the Texas Workers’ Compensation Commission, “would neither affect the
state’s system of reviewing worker’s compensation awards nor be disruptive of
the state’s policies respecting worker’s compensation.” Id.
The insurer in Trejo sought interpretation of a settlement agreement
after the available administrative process had been exhausted. 39 F.3d at
586−87. The posture here is similar: there is no other available administrative
process to review the decision of the Appeals Panel. While abstention is
appropriate on occasion, there exists a “virtually unflagging obligation of the
federal courts to exercise the jurisdiction given to them.” Colorado River, 424
U.S. at 817. Neither requirement of Burford abstention is satisfied by federal
court review of final decisions of the DWC. A federal district court hearing an
appeal from that decision would not meddle in the state administrative process
but would merely provide a forum for diverse parties to seek judicial review as
contemplated by Tex. Lab. Code. § 410.251. Accordingly, abstention is not
proper here.
B. Course and Scope of Employment
Turning to the merits, Zurich argues the district court erred in affirming
the finding of the Appeals Panel that Jasso was acting in the course and scope
of his employment within the meaning of Tex. Lab. Code § 401.011(12). This
court reviews the district court’s grant of summary judgment de novo, applying
the same standards as the district court. Haverda v. Hays Cnty., 723 F.3d 586,
591 (5th Cir. 2013). Summary judgment is proper only “if the movant shows
that there is no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). Further, “[o]n
cross-motions for summary judgment, we review each party’s motion
independently, viewing the evidence and inferences in the light most favorable
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to the nonmoving party.” 2 Trinity Universal Ins. Co. v. Emp’rs Mut. Cas. Co.,
592 F.3d 687, 691 (5th Cir. 2010) (citing Ford Motor Co. v. Tex. Dep’t of Transp.,
264 F.3d 493, 498 (5th Cir. 2001)). We “may affirm the district court’s decision
on any basis presented to the district court.” Haverda, 723 F.3d at 591
(internal quotation marks and citation omitted).
For an injury to be compensable under the Texas Workers’
Compensation Act, the injury must arise out of and in the course and scope of
employment. Tex. Lab. Code § 401.011(10). Course and scope of employment
is defined as “an activity of any kind or character that has to do with and
originates in the work, business, trade, or profession of the employer and that
is performed by an employee while engaged in or about the furtherance of the
affairs or business of the employer.” Id. § 401.011(12). This includes activities
conducted on the premises of the employer and at other locations. Id.
One statutory exclusion from course and scope is implicated in this case:
“transportation to and from the place of employment.” Id. § 401.011(12)(A).
This exclusion is commonly referred to as the “coming and going” exclusion. If
an employee’s ultimate destinations are home and work, despite any
intermediate stops in-between, the “coming and going” exclusion merits
analysis. Leordeanu v. Am. Prot. Ins. Co., 330 S.W.3d 239, 246 (Tex. 2010)
(“The ‘coming and going’ rule developed . . . specifically for travel between home
and work.”); see Zurich Am. Ins. Co., v. McVey, 339 S.W.3d 724, 727−29 (Tex.
App.—Austin 2011, pet. denied) (analyzing the “coming and going” exclusion
because the travel was between work and home even though the injury
2 The district court order stated that in “[v]iewing the facts most favorable to
Defendant, these summary facts establish that DCP required Jasso to travel as part of its
business.” The district court then relied on this finding in granting Sandra Jasso’s motion
and denying Zurich’s. In truth, there are no disputed facts, and the motions turn on the issue
of whether, as a matter of law, Jasso’s travel was in the course and scope of his employment
with DCP.
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occurred while the employee was first on his way to pick up a co-worker and
then to a mandatory work conference in another city).
However, even when the “coming and going” exclusion must be analyzed,
the activity might still be excepted from this exclusion if one of the following is
satisfied:
(i) the transportation is furnished as part of the contract of
employment or is paid for by the employer; (ii) the means of the
transportation are under the control of the employer; or (iii) the
employee is directed in the employee’s employment to proceed from
one place to another place.
Tex. Lab. Code § 401.011(12)(A)(i)−(iii) (emphasis added).
Satisfying an exception to the “coming and going” exclusion does not
necessarily mean the travel falls within the course and scope of employment;
it only means that this exclusion does not keep the activity outside the course
and scope of employment. McVey, 339 S.W.3d at 729. Once the exclusion is
deemed excepted from, courts then examine whether the activity originated in
the work of the employer and whether the employee was engaged in or about
the furtherance of the business of the employer. Id. at 730.
It is undisputed that Jasso was traveling to and from work in a truck
provided by DCP at the time of his accident. Thus, while the “coming and
going” exclusion is implicated, Jasso’s activity is excepted from this exclusion.
See Leordeanu, 330 S.W.3d at 249 (stating that the employee “was driving a
car provided by her employer at the time of her accident and therefore [was]
excepted from the ‘coming and going’ rule”). 3
3 Zurich argued that the district court erred by disagreeing with its argument that
since Jasso’s vehicle was not a necessity to his contract of employment with DCP, the
provision-of-the vehicle exception was ineffective. Under this theory, if the vehicle was not a
necessity to the contract of employment, it would be excluded under the coming and going
exclusion. Texas jurisprudence disagrees with this application. See Leordeanu, 330 S.W.3d
at 249 (applying the provision-of-the vehicle exception without considering necessity). As
discussed infra, necessity is only considered at the origination stage. See, e.g., Seabright Ins.
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Jasso’s activity still may be in the course and scope of his employment
with DCP, as long as it satisfies the origination and furtherance requirements.
Outside of the commuting context, furtherance may be a more complicated
question, but “[a]n employee’s travel to and from work makes employment
possible and thus furthers the employer’s business, satisfying” this
requirement. Id. at 242. As it is undisputed that Jasso was traveling to and
from work at the time of the accident, his activity satisfies the furtherance
requirement. The only remaining requirement is that the activity “originates
in the work, business, trade, or profession of the employer.” Tex. Lab. Code §
401.011(12).
In Texas, “there is no bright line rule for determining if employee travel
originates in the employer’s business as each situation is dependent on the
facts.” Seabright Ins. Co. v. Lopez, 427 S.W.3d 442, 448 (Tex. App.—San
Antonio 2014, pet. filed May 9, 2014). Further, “[n]o single fact is dispositive;
rather, [courts] consider the nature of the employee’s job, the circumstances of
the travel, and any other relevant facts.” Id. Courts are tasked with
“determin[ing] whether the relationship between the travel and the
employment is so close that it can fairly be said that the injury had to do with
and originated in the work, business, trade or profession of the employer.”
Leordeanu, 330 S.W.3d at 242 (citation omitted).
We start with the assumption that an employee’s travel to and from work
does not ordinarily satisfy origination, as “[t]he risks to which employees are
exposed while traveling to and from work are shared by society as a whole and
do not arise as a result of the work of employers.” Id. (quoting Evans v. Ill.
Emp’rs Ins. of Wausau, 790 S.W.2d 302, 305 (Tex. 1990)). However, as a
Co. v. Lopez, 427 S.W.3d 442, 448−49 (Tex. App.—San Antonio 2014, pet. filed May 9, 2014)
(discussing the concept of necessity as related to origination).
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general rule, an employee’s travel originates in his employer’s business if the
travel was pursuant to the express or implied requirements of the employment
contract. Tex. Mut. Ins. Co. v. Jerrols, 385 S.W.3d 619, 630 (Tex. App.—
Houston [14th Dist.] 2012, no pet. h.). In situations where “the employer
requires the employee to travel as part of its business—i.e., pursuant to the
contract of employment—the risk of traveling stems from that business and
properly can be said to arise as a result of the employer’s business.” Id.
(quotation omitted). Further, “only employer-provided transportation that
amounts to a necessity from the employer’s perspective, and not just a
gratuitous accommodation to the employee, is sufficient, without more,” to
satisfy the origination requirement. Seabright, 427 S.W.3d at 448−49
(emphasis added) (footnote omitted). It is clear, however, that even if the
vehicle was not a necessity to the contract, the court can still find that the
travel originated in the employer’s business. See id. (holding that “the
company truck was furnished to [the employee] gratuitously” and even still, as
a matter of law, the employee’s travel originated in and furthered the
employer’s business).
The Seabright court found that origination was satisfied based on the
additional evidence that the employee and his wife resided 450 miles away
from the jobsite, “[the employer] paid [the employee] a per diem while he was
working at the . . . jobsite that was not paid to its workers at its home office[,]
. . . and [the employee] used his per diem to stay at a motel about forty miles
[from the jobsite].” Id. at 459. This additional evidence “illustrate[d the
employer] clearly knew the only reason employees . . . would be present in the
area of [the jobsite] was their job.” Id. at 450. “As such, a commute to the
jobsite [was] not only expected, but in reality, required.” Id. In finding that
the travel satisfied origination, the Seabright court stated “a strong nexus
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between [the employee’s] employment and travel [existed] on the day of the
accident.” Id.
In the present case, the evidence in the record indicates that DCP’s
provision of the truck to Jasso was not a necessity to the contract of
employment because Jasso was required to pay income tax for his use of the
truck between work and home. There was no contravening evidence to suggest
the provision of the truck was anything more than gratuitous. Thus, DCP’s
provision of the truck does not establish on its own that Jasso’s travel was
within the course and scope of employment, and we must consider the
remaining evidence. See Seabright, 427 S.W.3d at 448−49. Facts that tend to
show there was a strong nexus between Jasso’s travel and his employment
with DCP are: (1) DCP supplied Jasso with the truck and a fuel card; (2) DCP
required Jasso to travel to the field sites away from the Fullerton office; (3)
Jasso traveled to field sites about 20% of the time; and (4) the wellness physical
was encouraged by DCP. Facts that do not tend to show strong nexus are: (1)
Jasso had to pay income tax for the use of his truck between work and home;
(2) this was not over-night and across-state travel as in Seabright, but travel
from Jasso’s home to an off-site work location; (3) Jasso was on the same route
he would have been on during his normal commute; and (4) Jasso left later
than normal and stopped by his doctor’s office before heading to the worksite.
Regarding the fact that Jasso was on the same route he would have been
on during his normal commute, it is true that “[t]he risks to which employees
are exposed while traveling to and from work are shared by society as a whole
and do not arise as a result of the work of employers.” Leordeanu, 330 S.W.3d
at 242. But Jasso was in fact traveling to the off-site Love Discharge Facility,
not the home office in Fullerton—which DCP required him to do—and which
created extra travel and extra risk for Jasso. Evidence in the record indicated
Jasso would be returning to the Fullerton office after his trip to the Love
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Discharge Facility. Jasso was on the only major road going north out of
Odessa, which happens to be along the same route as the home office. This
was extra travel and extra risk created by the requirements of Jasso’s
employment with DCP. It would be arbitrary for the compensability of Jasso’s
injuries to be based solely on the geographic placement of his off-site work
location. Additionally, it is not of particular import that Jasso left his home
later than normal, especially in light of the fact that DCP encouraged Jasso to
undergo the wellness physical. Further, while the travel required by DCP was
not hundreds of miles away from the home office, as in Seabright, DCP
nonetheless required Jasso to travel beyond his ordinary commute.
There was a strong nexus between Jasso’s travel to the Love Discharge
Facility on July 20, 2010, and his employment with DCP. We conclude that
Jasso’s travel to the off-site Love Discharge Facility on the day of his accident
originated in the business of DCP. Accordingly, we affirm the district court’s
finding that Jasso’s travel was in the course and scope of his employment with
DCP.
C. Attorney’s Fees
Lastly, counsel for Sandra Jasso argues that the district court
improperly reduced his attorney’s fees. It is understood that “[i]n awarding
attorney’s fees, the district court is empowered to exercise its informed
discretion, and a reviewing court will not disturb the judgment of the district
court absent a showing of an abuse of discretion.” Graves v. Barnes, 700 F.2d
220, 221 (5th Cir. 1983). Further, “the district court’s factual findings
[regarding attorney’s fees] will not be disturbed unless they are clearly
erroneous.” Id. at 221−22. Tex. Lab. Code § 408.221(c) is a fee-shifting statute
that provides:
[a]n insurance carrier that seeks judicial review . . . of a final
decision of the appeals panel regarding compensability or
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eligibility for, or the amount of, income or death benefits is liable
for reasonable and necessary attorney’s fees . . . incurred by the
claimant as a result of the insurance carrier’s appeal if the
claimant prevails on an issue on which judicial review is sought by
the insurance carrier . . . .
Fees sought under this statute must be approved by the court based on written
evidence presented to the court. Id. § 408.221(a), (b). The court considers
seven factors in evaluating the fee: (1) the time and labor required; (2) the
novelty and difficulty of the questions involved; (3) the skill required to perform
the legal services properly; (4) the fee customarily charged in the locality for
similar legal services; (5) the amount involved in the controversy; (6) the
benefits to the claimant that the attorney is responsible for securing; and (7)
the experience and ability of the attorney performing the services. Id. §
408.221(d)(1)−(7). It is not necessary to establish each of these factors. See
Hays & Martin, L.L.P. v. Ubinas-Brache, 192 S.W.3d 631, 636 (Tex. App.—
Dallas 2006, pet. denied).
The district court reduced the hourly rate requested by Sandra Jasso’s
counsel from $375 per hour to $288 per hour. Zurich pointed out that 28 Tex.
Admin. Code § 152.4(d) allows for a maximum rate of $150, less than half the
rate requested by Sandra Jasso’s counsel. The district court found it was not
bound by this limitation, however, but only by Tex. Lab. Code § 408.221(d)
because an award under § 408.221(c) “is not subject to commissioner rules . . . .”
Tex. Lab. Code § 408.221(c). This is correct because the award here is made
pursuant to Tex. Lab. Code § 408.221(c), as Zurich sought judicial review of a
final decision of the Appeals Panel regarding the issue of Sandra Jasso’s
eligibility for death benefits, on which Sandra Jasso originally prevailed.
The forum district in this case, Odessa, Texas, is the relevant locality in
which to compare the fees customarily charged. Hawkins v. Nat’l Ass’n of Sec.
Dealers, Inc., No. 3−96−CV−3219−R, 1998 WL 74259, at *1 (N.D. Tex. Feb. 13,
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1998); Garmong v. Montgomery Cnty., 668 F. Supp. 1000, 1007 (S.D. Tex.
1987). Zurich put forth evidence that the $375 hourly rate is not consistent
with prevailing rates in Odessa, Texas. This is the main factor from Tex. Lab.
Code § 408.221(d) on which the district court relied. Zurich provided the Texas
Lawyer’s Annual Salary and Billing 2012 Survey and the State Bar of Texas
2011 Hourly Fact Sheet. The district court noted that: (1) the average billing
rate for equity partners in San Antonio in 2012 was $285 per hour; (2) the rates
for equity partners in Texas in areas other than Dallas, Houston, or San
Antonio averaged $289 per hour; (3) the median rate in West Texas for
personal injury litigation was $205 per hour and $257 per hour for labor and
employment litigation; and (4) attorneys with approximately 25 years of
experience in West Texas charged an average of $288 per hour. Based on this,
the district court found the $375 per hour rate too high. The district court
relied on reasonable data in reducing Sandra Jasso’s counsel’s hourly billing
rate to $288. Thus, the district court did not abuse its discretion and made no
clearly erroneous factual findings in reducing the hourly rate of Sandra Jasso’s
counsel. See Graves, 700 F.2d at 221.
The district court also reduced the fees requested for time spent traveling
to 17.5 hours at the hourly rate of $288, as opposed to the requested 35 hours
at $375 per hour. Courts often reduce working and non-working travel time.
See In re Babckock & Wilcox Co., 526 F.3d 824, 828 (5th Cir. 2008) (per curiam)
(noting that generally “it is not an abuse of discretion to discount non-working
(and even working) travel time”); see also Watkins v. Fordice, 7 F.3d 453,
458−59 (5th Cir. 1993) (holding that the district court did not abuse its
discretion by reducing the hourly rate billed by 50% for travel time). As the
district court properly noted, counsel for Sandra Jasso did not provide any
evidence that work was done during this travel and did not demonstrate that
comparably skilled practitioners charge their full hourly rate for travel time.
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The district court did not abuse its discretion by reducing attorney’s fees for
time billed while traveling.
The district court also did not allow any expenses because no written
evidence of the expenses was given; counsel merely listed the lump sum owed
of $2,516.79. Instead, the district court reserved judgment on the issue of
expenses until counsel provided the court with invoices, receipts, and
supporting affidavits (including the descriptions and nature of each expense
and the reasons therefore). Sandra Jasso’s counsel filed supplements in the
form of spreadsheets showing the amount, date, and description of expenses
incurred in this case. The district court ruled that Sandra Jasso’s counsel did
not provide adequate documentation in the form of invoices or receipts, as
requested, but rather only provided its in-house expense spreadsheet. Thus,
the district court denied Sandra Jasso’s counsel all requested expenses. The
district court did not abuse its discretion in disallowing these expenses after
counsel did not comply with its order. See Glass v. U.S., 335 F. Supp. 2d 736,
742−43 (N.D. Tex. 2004) (holding that failure to produce supporting
documentation regarding billing statements of counsel after an order to was a
factor in denying requested attorney’s fees).
Counsel for Sandra Jasso also requested attorney’s fees in the event the
district court case was appealed to this court and the United States Supreme
Court. The district court denied the request for appellate fees. It is well settled
in this circuit that a denial of appellate attorney’s fees by the district court
before an appeal is taken is proper. Instone Travel Tech Marine & Offshore v.
Int’l Shipping Partners, Inc., 334 F.3d 423, 433 (5th Cir. 2003) (“It is difficult
to imagine how a district court’s refusal to award appellate attorney fees before
an appeal had even been taken could possibly be declared an error.”). Rather,
“[t]he issue of appellate attorney’s fees is a matter for the district court
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following the resolution of an appeal.” Id. Thus, the district court did not
abuse its discretion by not allowing these prospective appellate fees.
The district court did not abuse its discretion in disallowing any of the
requested attorney’s fees from Sandra Jasso’s counsel.
III. CONCLUSION
In conclusion, we AFFIRM the district court’s denial of Sandra Jasso’s
motion to dismiss. We also AFFIRM the district court’s grant of partial
summary judgment in favor of Sandra Jasso and its denial of Zurich’s motion
for summary judgment. Lastly, we AFFIRM the district court’s denial of
certain attorney’s fees requested by counsel for Sandra Jasso.
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