Whitney v. Secretary of Health and Human Services

In the United States Court of Federal Claims
OFFICE OF SPECIAL MASTERS
*********************
REBECCA WHITNEY and *
RANDALL WHITNEY, parents of * No. 10-809V
S.W., a minor, * Special Master Moran
*
Petitioners, * Filed: July 27, 2016
*
v. *
* Attorneys’ fees and costs;
* expert hours, flat rate for appearance.
SECRETARY OF HEALTH *
AND HUMAN SERVICES, *
*
Respondent. *
*********************
Ronald C. Homer, Conway, Homer & Chin-Caplan, P.C., Boston, MA, for
Petitioners;
Lara A. Englund, United States Dep’t of Justice, Washington, DC, for Respondent.
PUBLISHED DECISION AWARDING ATTORNEYS’ FEES AND COSTS 1
After a remand from the Court of Federal Claims, petitioners Rebecca and
Randall Whitney received compensation from the Vaccine Program. This award
entitles them to reasonable attorneys’ fees and costs and they have filed a motion
requesting those fees and costs. The Whitneys initially sought $205,865.22. The
Secretary filed a weak response, arguing a reasonable amount is no more than
$146,000 and could be as little as $97,000. The petitioners are awarded
$195,076.22.
1
The E-Government Act of 2002, 44 U.S.C. § 3501 note (2012) (Federal Management
and Promotion of Electronic Government Services), requires that the Court post this decision on
its website. Pursuant to Vaccine Rule 18(b), the parties have 14 days to file a motion proposing
redaction of medical information or other information described in 42 U.S.C. § 300aa-12(d)(4).
Any redactions ordered by the special master will appear in the document posted on the website.
I. Background2
On November 22, 2010, the Whitneys filed their case on a pro se basis.
Their current attorney (Mr. Ronald Homer) became counsel of record in March
2011. Mr. Homer essentially restarted the case at that time.
Around three months of age, the Whitneys’ child (S.W.) developed an upper
respiratory infection. This infection was probably, but not certainly, a
manifestation of a human herpes virus, type 6 (HHV-6). At S.W.’s 4-month well-
baby checkup, S.W. received a set of vaccinations including the diphtheria-tetanus-
acellular pertussis (DTaP) vaccine. About 10 days later, S.W. began to manifest
neurologic problems.
His neurologic problems worsened and he was hospitalized. Doctors
eventually diagnosed S.W. as suffering from transverse myelitis. The treating
doctors were not certain of the cause of his transverse myelitis. Doctors pointed to
the HHV-6 infection and the preceding vaccination. See exhibit 2 at 264-65.
The transverse myelitis is relatively severe. S.W. requires a wheelchair and
has challenges learning. Exhibit 22 at 3.
After gathering medical records, the Whitneys obtained a report from a
neurologist, Yuval Shafrir. Exhibit 16. The Secretary filed reports from two
experts: Max Wiznitzer and Raoul Wientzen. Like Dr. Shafrir, Dr. Wiznitzer is a
neurologist. Exhibit C. The Secretary added a specialist in infectious diseases,
Raoul Wientzen, to discuss HHV-6. Exhibit A. Because the Secretary had
obtained a report from a non-neurologist, the Whitneys retained a second expert,
immunologist and infectious disease specialist James Oleske. Exhibits 18, 20.
Before the hearing, both parties filed briefs. The hearing was conducted in
two sessions. On February 27, 2014, the two neurologists testified. On March 7,
2014, Dr. Oleske and Dr. Wientzen testified. After the hearing, the parties again
filed briefs.
A decision was issued on May 8, 2015. It found that the Whitneys were not
entitled to compensation. 2015 WL 4537210.
2
A more detailed recitation of events can be found in the initial decision. 2015 WL
4537210 (May 8, 2015).
2
The Whitneys filed a motion for review, accompanied by a 41-page
memorandum. The Secretary responded.
The Court granted the motion for review and vacated the May 8, 2015
decision. The Court did not find any facts, but, instead, recommended obtaining
testimony from the treating doctors who had commented on either the vaccines or
HHV-6 as a cause for S.W.’s transverse myelitis. 122 Fed. Cl. 297 (2015).
The undersigned implemented the Court’s instructions. The Whitneys’
counsel (more precisely a paralegal at the Conway, Homer, Chin-Caplan P.C. law
firm) took on the task of finding the doctors and arranging their participation. A
hearing was scheduled to take place on September 2, 2015, in Grand Rapids,
Michigan. Order, issued August 26, 2015.
While the parties (particularly the Whitneys) were tending to the logistics of
scheduling this hearing, they were also, at the undersigned’s urging, considering
resolution. In post-remand status conferences, the undersigned commented that the
opinions of the treating doctors were unknown, and this uncertainty meant both
parties bore risk of continued litigation. With this encouragement, the parties
reached a tentative agreement.
With a tentative agreement in hand, the parties requested that the Court
extend the time for remand. The Court did so. Order, filed Sep. 1, 2015. In due
course, the parties finalized their tentative agreement. The parties’ stipulation was
incorporated into a decision. 2015 WL 9031352 (Dec. 1, 2015). This decision
awarded the Whitneys a lump sum plus an annuity to last the remainder of S.W.’s
life. This action concluded the merits phase of the case.
On April 14, 2016, the next phase of the case began, when the Whitneys
filed for attorneys’ fees and costs. Individual components were:
Attorneys’ Fees $149,460.75
Attorneys’ Costs $49,704.47
Petitioners’ Costs $350.00
Other Costs $6,350.00
TOTAL $205,865.22
3
The Secretary filed a response. Although the Federal Circuit has endorsed
the lodestar method as a way of determining a reasonable amount of attorneys’
fees, Avera v. Sec’y of Health & Human Servs., 515 F.3d 1343, 1347-48 (Fed Cir.
2008), the Secretary’s response addressed neither the proposed hourly rate nor the
number of hours requested. Likewise, the Secretary did not comment on any
requested costs. Instead, the Secretary proposed a range of $97,000 to $146,000
without citing any cases. Resp’t’s Resp., filed May 2, 2016, at 3. The Secretary’s
approach is now unfortunately routine. See Dorego v. Secʼy of Health & Human
Servs., No. 14-337V, 2016 WL 1635826 (Fed. Cl. Spec. Mstr. April 4, 2016).
The Whitneys filed a reply, which mostly repeated arguments their attorney
had made in other cases. They also added a request for $464 in supplemental fees.
Pet’rs’ Supp’l Mot. for Attorneys’ Fees, filed May 12, 2016.
II. Analysis
The Whitneys’ motion contains two parts: a request for attorneys’ fees and a
request for costs. These are addressed separately.
A. Attorneys’ Fees
The Vaccine Act authorizes special masters to award only “reasonable”
attorneys’ fees. 42 U.S.C. § 300aa–15(e)(1). To determine the reasonableness of a
request for attorneys’ fees, the court must first conduct a lodestar analysis in which
a reasonable hourly rate is multiplied by a reasonable number of hours. See Avera,
515 F.3d at 1348; Saxton v. Sec’y of Health & Human Servs., 3 F.3d 1517, 1521
(Fed. Cir. 1993). Second, the court may make an upward or downward departure
from the initial calculation of the fee award based on specific findings. Avera, 515
F.3d at 1348.
Here, the lodestar calculation produces a reasonable award of attorneys’
fees. A separate adjustment is not required. Thus, the analysis below focuses on
(1) a reasonable hourly rate and (2) a reasonable number of hours.
1. Reasonable hourly rate
McCulloch v. Secʼy of Health & Human Servs., No. 09-293V, 2015 WL
563423 (Fed. Cl. Spec. Mstr. Sept. 1, 2015), found reasonable hourly rates for
attorneys in the Conway, Homer, Chin-Caplan, P.C. law firm. Special masters,
including the undersigned, have followed McCulloch. See Avchen v. Secʼy of
Health & Human Servs., No. 14-279V, 2015 WL 9595415 (Fed. Cl. Spec. Mstr.
Dec. 4, 2015). The Whitneys’ attorneys have billed in accord with the McCulloch
4
rates and the Secretary did not impose any specific objection. The undersigned
finds the requested hourly rates reasonable.
2. Reasonable number of hours
According to the United States Supreme Court, fee applicants should
exercise “billing judgment.” Hensley v. Eckerhart, 461 U.S. 424, 434 (1983).
This obligation includes attorneys who work in the Vaccine Program. Saxton, 3
F.3d at 1521.
Here, there is relatively little evidence that the Whitneys’ attorneys exercised
any billing judgment. The attorneys’ timesheets include more than 1000 entries.
Each entry, except one, is marked “billable.” The only exception was on Dec. 17,
2015. The remaining 649 hours are, according to petitioners’ attorneys’
timesheets, billable. See timesheets at internal page 97.
Have the Whitneys’ attorneys truly concluded that the 649 hours contain no
duplication of tasks? Do any of the more than 1000 entries contain charges that are
excessive? The attorneys may believe they are justified in claiming all these hours,
reasoning “we only perform the work that was necessary. Therefore, all performed
work was reasonable.”
The obligation to remove “excessive, redundant, or otherwise unnecessary”
hours is well-established. Saxton, 3 F.3d at 1521. However, any voluntary
reduction comes at the expense of a law firm’s revenue. In practical terms, fee
applicants have a monetary incentive to request as much as possible and then leave
any reductions to their adversary.
Traditionally, the Secretary has, to a greater or lesser degree, policed fee
applications. Because awards of attorneys’ fees are paid from the Trust Fund that
the Secretary administers, the Secretary has an interest in protecting against
excessive awards, which necessarily deplete the Trust Fund. Over the years, the
Secretary has fulfilled her duty with a two-step process: (1) informal discussions,
and (2) formal litigation. In most cases, a sense of reasonableness and a spirit of
compromise led to quick and mutually agreeable resolutions. In some cases, the
Secretary’s attorney did not interpose any objection. In other cases, the Secretary
would communicate concerns or objections about the fee application. When
informed about those potential challenges, a petitioner’s attorney would reduce the
amount requested, and, in turn, the Secretary’s attorney agreed not to object.
5
Without an objection, the special master usually found the (reduced) amount
reasonable.3 In a minority of cases, the parties could not reach an accommodation.
In such cases, the Secretary would present formal objections and the petitioners
would reply. Under either of these scenarios, the special master had the benefit
from an evaluation from the Secretary.
Now, the Secretary is largely absent. The Secretary’s most concrete
objection is to propose a range. However, as the petitioners’ reply notes, the Court
of Federal Claims held that a range approach is inconsistent with the lodestar
methodology. Guerrero v. Sec’y of Health & Human Servs., 120 Fed. Cl. 474, 482
(2015), mot. for rev. granted in part and denied in part after remand, 124 Fed. Cl.
153 (2015), app. dismissed, No. 2016-1753 (Fed. Cir. April 22, 2016).4 Moreover,
the Secretary does not explain how it selects cases falling into the range, and, in
this case, as in many other recent cases, the Secretary provided no examples of
comparable cases.5 Therefore, at best, the Secretary is providing information that
has little utility.
Without the Secretary’s participation, the undersigned has waded through
the timesheets. In this review, the undersigned has been guided with his
experience with this law firm. See Saxton, 3 F.3d at 1521. The undersigned has
paid particular attention to potential problem areas.
1. Multiple attorneys. A recurring issue is that this law firm assigns
multiple attorneys to work on one case. This staffing practice is not consistent
with the work of other firms. Most firms assign, at most, one partner and one
associate and achieve good results. See Caves v. Sec’y of Health & Human Servs.,
No. 07–443V, 2012 WL 6951286, at *4 (Fed. Cl. Spec. Mstr. Dec. 20, 2012)
(identifying attorneys with different staffing models), mot. for review denied, 111
Fed. Cl. 774 (2013); Whiffen v. Sec’y of Health & Human Servs., No. 03–1223V,
3
Rarely, special masters found unreasonable components in a fee application sua sponte.
Savin v. Sec’y of Health & Human Servs., 85 Fed. Cl. 313, 315-16 (2008).
4
If the Secretary wanted to advocate for a methodology based upon ranges, the
Secretary’s recourse was to seek review in the Federal Circuit. Although the Secretary filed a
notice of appeal, the parties agreed to a dismissal. The Secretary’s abandonment of the appeal in
Guerrero leaves the opinion of the Court of Federal Claims intact.
5
More recently, when the Secretary has proposed a range, the Secretary has started to
cite cases falling within her proposed range.
6
2010 WL 5558348 (Fed. Cl. Spec. Mstr. Dec. 15, 2010) (describing different law
firm practices for cases in the autism omnibus proceeding).
Here, the original associate was Ms. Amy Fashano. The 3.1 hours she spent
at the inception of the case are credited. After a few months, the primary associate
became Ms. Meredith Daniels. Ms. Daniels spent the vast amount of time
litigating the case and all her time is accordingly credited. After Ms. Daniels
effectively took over, Ms. Fashano billed small tasks that duplicated work Ms.
Daniels had already performed. These extra hours from Ms. Fashano are deducted.
Similarly, two other associates, Ms. Christina Ciampolillo and Mr. Joseph
Pepper, also worked on the case. They often edited routine and short documents
such as status reports and motions for enlargement of time. Ms. Daniels is capable
of this work. A client paying for the services of this law firm would be unlikely to
engage another associate. Thus, this time is removed. On the other hand, review
of more significant documents is reasonable. E.g. entry for January 8, 2014
(prehearing brief). See Avchen, 2015 WL 9595415, at *5-6.
2. Mr. Homer. The point about associate staffing is similar to a question
about partner level contributions. One of the partners, Mr. Homer, is listed as
counsel of record. He charges for reviewing all documents filed into the record.
However, Mr. Homer did not participate in status conferences, interact with the
client routinely, or attend the trial.
This practice of charging partner rates for review of documents filed in a
case an associate is handling appears unique to this firm. Special masters have
addressed this issue. Tomlinson v. Secʼy of Health & Human Servs., No. 13-
763V, 2015 WL 7068558, at *4 (Fed. Cl. Spec. Mstr. Oct. 23, 2015); Austin v.
Secʼy of Health & Human Servs., No. 10-362V, 2013 WL 659574, at *14 (Fed. Cl.
Spec. Mstr. Jan. 31, 2014).
If a client were given a choice between paying an attorney at a rate of $400
an hour and paying an attorney at a rate of $280 an hour to perform the same task,
the paying client would choose the less costly option. Ms. Daniels, who
participated in numerous status conferences, was capable of reading any order
from any status conference. Charges associated with Mr. Homer’s time are
excessive and reduced to Ms. Daniels’ rate.
Based on the foregoing, the deductions for associate staffing and Mr. Homer
total $2,478.00. Compared to the amount of fees originally requested
7
(approximately $150,000), this deduction is relatively trivial, slightly more than
one and a half percent.
The size of the deduction leads to additional questions. Should the
petitioners’ attorney exercise “billing judgment” to remove these items
voluntarily? Deleting these entries before submitting a fee application would
speed the process of adjudication. On the other hand, when the deductions are so
small, should the undersigned find the overall amount reasonable and not examine
entries? A less thorough review would also speed processing.
Other than the two points about staffing, the remaining activities are
reasonable. In proceedings before the special master, the petitioners obtained
reports from two experts, filed a brief before the hearing, and filed two briefs after
the hearing. The hearing was conducted in two separate sessions, about two weeks
apart, and the interval between sessions required extra preparation.
The Whitneys also filed a motion for review. In past cases, attorneys from
this law firm have copied and pasted from one brief to another and then charged as
if the work were freshly produced. This practice is not appropriate. Davis v. Sec’y
of Health & Human Servs., 105 Fed. Cl. 627, 638 (2012); see also Broekelschen v.
Sec’y of Health & Human Servs., 102 Fed. Cl. 719, 730-31 (2011) (discussing
copying and pasting in the context of a different attorney).
That past practice did not occur here. In conjunction with this decision, the
undersigned reviewed the trial briefs and the motion for review. The motion for
review contains new arguments, not presented in briefs below. The timesheets are
consistent with an extra effort at the motion for review level. For the initial post-
trial brief, Ms. Daniels spent approximately 24 hours drafting it. A partner, Kevin
Conway, contributed 4.5 hours of editing. For the reply brief, the respective
amounts of time were 4 hours and 0.7 hours. For the motion for review, Ms.
Daniels and Mr. Conway spent relatively similar amounts of time: approximately
23 hours and approximately 7 hours. Their efforts were amplified by another
attorney, Sylvia Chin-Caplan. Ms. Chin-Caplan added another 21 hours to writing
the motion for review.
As mentioned above, the collective efforts produced a brief that contained
new arguments. As such, the attorneys did not duplicate large sections of previous
briefs. Thus, the time spent on the motion for review is credited in full.
Likewise, the attorneys charged a reasonable amount for litigating the
amount of fees. The supplemental fee motion includes only 1.1 hours from Ms.
8
Daniels, 0.1 hours from Mr. Homer, and 0.4 hours from Mr. Pepper. The
associated brief reproduces arguments that the firm has presented in other cases.
Ms. Daniels’ work was to conform the standard brief to the specifics of this case.
Her work, Mr. Homer’s work, and Mr. Pepper’s work are reasonable. The fee for
the reply brief is $464.00, which is awarded in full.
For attorneys’ fees, petitioners are awarded $147,446.75.
B. Costs
The Whitneys also request costs, which they organize into three
components: costs for the law firm ($49,704.47), costs for the petitioners
($350.00), and other costs ($6,350.00). As with fees, the Secretary did not
challenge any items of costs specifically.
Most of the costs are relatively routine, such as costs for obtaining medical
records, mailings, photocopies, telephone, and the transcript from the hearing.
Another set of expenses relate to travel for the hearings. All of these costs are
reasonable and documented, and are awarded in full.
The bulk of the costs concerned time for Dr. Shafrir and Dr. Oleske. See
entries for September 30, 2013, April 20, 2014, and August 7, 2014. Like
attorneys’ fees, reasonable expert fees are determined using the lodestar method in
which a reasonable hourly rate is multiplied by a reasonable number of hours.
Dr. Shafrir seeks a total of $20,425.00. This figure represents 47.5 hours at
$350 per hour plus 9 hours at $500 per hour. Dr. Shafrir charged a higher hourly
rate for participating in the February 27, 2014 hearing.
Dr. Shafrir’s proposed rate of $350 or $500 per hour for work performed
from November 2012 through February 2014 is reasonable. Both rates are
consistent with rates special masters have credited for neurologists. See Brown v.
Sec’y of Health & Human Servs., No. 09–426V, 2012 WL 952268, at *11 (Fed.
Cl. Spec. Mstr. Feb. 29, 2012) (awarding Dr. Lawrence Steinman, a neurologist
based in Stanford, California, $450-$500 per hour).
The amount of time Dr. Shafrir spent was also reasonable. In the future,
however, Dr. Shafrir should describe his activities in more detail. Consolidating
two days of activities, totaling 9 hours, into three lines of text, totaling 13 words,
does not provide much detail. Experts, like attorneys, should avoid block-billing.
Caves v. Sec’y of Health & Human Servs., 111 Fed. Cl. 774, 781 (2013).
9
Dr. Oleske seeks a total of $14,500.00. He proposes a rate of $500 per hour
and he seeks compensation for 29 hours. In addition, Dr. Oleske includes a request
for 10 hours of work for an assistant, who charges $100 per hour.
Dr. Oleske’s rate of $500 per hour is accepted as reasonable. See Sexton v.
Secʼy of Health & Human Servs., No. 99-453V, 2015 WL 7717209, at *4 (Fed. Cl.
Spec. Mstr. Nov. 9, 2015). However, his time is not.
For his first report (exhibit 18), Dr. Oleske has invoiced for 18 hours plus 5
hours of assistant time. The work product is barely three double-spaced pages.
Although Dr. Oleske stated he reviewed medical records, his report contains only a
succinct recitation of facts without any cites to underlying records. Furthermore,
although Dr. Oleske stated he spent more than two hours reviewing literature on
HHV-6, his report cites only one article. That article is a three-page extract from a
common source of information, the American Academy of Pediatrics Red Book.
Under these circumstances, a reasonable amount of time is 10 hours. With respect
to the administrative assistant, the petitioners are given a benefit of the doubt that 5
hours is reasonable.
For his second report (exhibit 20), Dr. Oleske has invoiced for 3 hours plus
another 5 hours of assistant time. This report was approximately 2.5 double-
spaced pages. Of these 2.5 pages, approximately one page was a lengthy quotation
from an article Dr. Oleske cited. Thus, the actual fresh work product is about 1.5
pages. Dr. Oleske cited 7 articles, of which he wrote 5. The amount of time for
this report (3 hours) is somewhat high but within a reasonable range. Dr. Oleske is
also credited for 8 hours of time for attending the hearing. Finally, his assistant’s
time is again credited, although with some concerns.
The remaining expenses incurred by the law firm, including costs for the life
care planner and for an attorney to arrange a guardianship, are reasonable. The
adjustments for Dr. Oleske’s first report are $4,000. Therefore the Whitneys are
awarded $45,704.47 in attorneys’ costs. The petitioners are also awarded their
own costs, $350.
The last item of cost is unusual. A doctor who treated S.W., William Rush,
has invoiced for $350 for chart review plus $6,000 for testimony that Dr. Rush had
agreed to provide in the hearing scheduled for Wednesday, September 2, 2015.
However, on Monday, August 31, 2015, the parties reached a tentative agreement
and the hearing was canceled.
10
The cancellation of the hearing two business days before it was scheduled
justifies an award to Dr. Rush in some amount. Demar v. United States, 199
F.R.D. 617, 620 (N.D. Ill. 2001). The question is how much is reasonable?
Federal district courts have split over whether treating doctors should be
compensated as fact witnesses or expert witnesses. Baker v. John Morrell & Co.,
263 F. Supp. 2d 1161, 1206 (N.D. Iowa 2003); Demar, 199 F.R.D. at 618. Here,
the Secretary has not made any argument pro or con. In the absence of an
objection from the Secretary, Dr. Rush will be compensated at a reasonable expert
rate.
Even at an expert rate, Dr. Rush’s proposed charge is not reasonable. The
parties arranged for Dr. Rush to testify first (starting at 8:30 AM) to minimize any
wait time. The parties also anticipated his testimony would last 1.5 hours ending at
10:00 AM. To be generous, Dr. Rush may have kept his schedule free until noon,
meaning he committed to 3.5 hours. Even if Dr. Rush testified as scheduled, his
afternoon was open for usual activities, including seeing patients.
Under the circumstances, a charge of $6,000 is exorbitant. A reasonable
amount of time for Dr. Rush’s anticipated schedule is 3.5 hours. See Broushet v.
Target Corp., 274 F.R.D. 432, 434 (E.D.N.Y. 2011) (awarding compensation to
expert only for time spent in deposition). Another hour is added for chart review.
The total reasonable compensation for Dr. Rush is $1,575 (4.5 x $350).
III. Additional Comments
The petitioners originally requested $205,865.22 in attorneys’ fees and costs,
an amount that was amended to $206,329.22. This decision awards $195,076.22,
which is 95 percent of the amended amount.
To determine this result, the process consumed a substantial amount of
judicial resources. While the duties in managing a docket and deciding cases vary,
recently the undersigned has spent a significant amount of time on resolving
attorney fees, perhaps in excess of 50 percent.
A few years ago, an expenditure of such judicial resources probably would
not have been needed. From the undersigned’s experience in adjudicating over one
hundred fee applications, it is highly likely that counsel for the parties could have
reached a result very close (maybe a little less, maybe a little more) to the amount
determined here after a few hours of discussion. The Secretary’s unwillingness to
participate in compromises has increased litigation.
11
Once special masters are forced to determine reasonable attorneys’ fees and
costs, they inevitably will attempt to write opinions that provide an adequate basis
for their decisions. Guerrero, 120 Fed. Cl. at 480; Davis, 105 Fed. Cl. at 639.
Hence, the length of this decision.
The present system for resolving fees is not good for other petitioners in the
Vaccine Program whose claims await adjudication. It is also bad for the attorneys
who represent petitioners whose statutorily-endorsed requests for payment await
adjudication. Some other system would be better.
IV. Conclusion
The Whitneys are entitled to a reasonable amount of attorneys’ fees and
costs. They have established a reasonable amount is $195,076.22. This amount
shall be made payable as follows:
$193,151.22 to the petitioners and their attorney, Ronald C. Homer;
$350.00 to the petitioners; and
$1,575 to Ronald C. Homer and William Rush.
The Clerk’s Office is instructed to issue judgment in accord with this
decision.
IT IS SO ORDERED.
s/Christian J. Moran
Christian J. Moran
Special Master
12