Kottenstette v. Secretary of Health and Human Services

In the United States Court of Federal Claims
OFFICE OF SPECIAL MASTERS
No. 15-1016V
Filed: October 11, 2019
UNPUBLISHED
MARYELLEN KOTTENSTETTE and Special Master Horner
NICHOLAS KOTTENSTETTE, as best
friends of their daughter (CK), Interim Attorneys’ Fees and
Costs Decision; Reasonable
Petitioners, Hourly Rate; Excessive Billing
v.
SECRETARY OF HEALTH AND
HUMAN SERVICES,
Respondent.
John F. McHugh, New York, NY, for petitioners.
Camille M. Collett, U.S. Department of Justice, Washington, DC, for respondent.
DECISION AWARDING INTERIM ATTORNEYS’ FEES AND COSTS1
After respondent moved for review of Special Master Millman’s ruling that
petitioners are entitled to compensation, petitioners filed a second motion for interim
attorneys’ fees and costs on August 9, 2019, seeking an award of $74,844.102 for
interim attorneys’ fees and costs incurred from September 1, 2017 to August 9, 2019.
(ECF No. 111.) For the reasons discussed below, I award petitioners $57,222.29.
1 Because this decision contains a reasoned explanation for the special master’s action in this case, it will
be posted on the United States Court of Federal Claims’ website in accordance with the E-Government
Act of 2002. See 44 U.S.C. § 3501 note (2012) (Federal Management and Promotion of Electronic
Government Services). This means the decision will be available to anyone with access to the
Internet. In accordance with Vaccine Rule 18(b), petitioner has 14 days to identify and move to redact
medical or other information the disclosure of which would constitute an unwarranted invasion of privacy.
If the special master, upon review, agrees that the identified material fits within this definition, it will be
redacted from public access.
2Petitioners’ application requested $59,298.15 in attorneys’ fees, $187.50 in paralegal fees, and
$15,545.95 in attorneys’ costs. (ECF No. 111, p. 1.) However, upon review of the billing records,
$187.50 in paralegal fees were already included as part of the $59,298.15 in attorneys’ fees. (ECF No.
111, Ex. 1, p. 4.) Accordingly, the total requested interim attorneys’ fees and costs is $74,844.10.
1
I. PROCEDURAL HISTORY
On September 11, 2015, petitioners filed a petition under the National Childhood
Vaccine Injury Act, 42 U.S.C. §§ 300aa-10–34 (2012), alleging that diphtheria-tetanus-
acellular pertussis (“DTaP”), haemophilus B influenza (“HiB”), inactivated polio vaccine
(“IPV”), and pneumococcal (“Prevnar”) vaccines administered to their daughter C.K. on
October 2, 2012, caused her to suffer a Table encephalopathy or, in the alternative, a
non-Table encephalopathy and infantile spasms.
After an entitlement hearing was held, petitioners filed their first application for
interim attorneys’ fees and costs on October 11, 2017, seeking interim attorneys’ fees
and costs through August 1, 2017. (ECF No. 68.) On October 30, 2017, Special
Master Millman found an award of interim attorneys’ fees and costs reasonable and
awarded petitioners $117,303.38 in interim attorneys’ fees and costs.
Subsequently, On December 12, 2017, Special Master Millman ruled for
petitioners on entitlement. (ECF No. 78.) On May 29, 2019, respondent filed
Respondent’s Proffer on Award of Compensation, which Special Master Millman found
reasonable and adopted in her Decision Awarding Damages. (ECF Nos. 100, 101.)
On June 6, 2019, this case was reassigned to me. (ECF No. 104.)
Subsequently, on June 28, 2019, respondent filed a Motion for Review of the Ruling on
Entitlement. (ECF No. 107.) The case was assigned to Senior Judge Firestone. (ECF
No. 109.)
On August 9, 2019, petitioners filed a second application for interim attorneys’
fees and costs accrued during the period of September 1, 2017 to August 9, 2019.
(ECF No. 111.) Petitioners represented that due to the ongoing litigation concerning
respondent’s motion for review, “vendors are insisting on payment” and “this interim fee
application is needed to pay services used in the settlement process and rendered to
respond to the motion.” (Id. at 2.)
On August 22, 2019, respondent filed a response to petitioners’ application for
interim attorneys’ fees and costs. (ECF No. 113.) “Respondent defers to the Special
Master to determine whether or not petitioners have met the legal standard for an
interim fees and costs award, as set forth in Avera.”3 (ECF No. 113, p. 2 (citations
omitted).) Respondent requested the special master exercise his discretion to
determine a reasonable award for interim attorneys’ fees and costs should the special
master conclude that such award is appropriate. (Id. at 3.)
On August 23, 2019, Senior Judge Firestone directed the clerk to forward
petitioners’ application for fees and expenses along with the response to the special
master for a decision pursuant to Vaccine Rule 13(b). (ECF No. 114.)
This matter is now ripe for consideration.
3 Referencing Avera v. Sec’y of Health & Human Servs., 515 F.3d 1343 (Fed. Cir. 2008).
2
II. DISCUSSION
A. Entitlement to Fees Under the Vaccine Act
Section 15(e)(1) of the Vaccine Act allows for the special master to award
“reasonable attorneys' fees, and other costs.” § 300aa–15(e)(1)(A)–(B). Petitioners are
entitled to an award of reasonable attorneys' fees and costs if they are entitled to
compensation under the Vaccine Act, or, even if they are unsuccessful, if the special
master finds that the petition was filed in good faith and with a reasonable basis. Avera
v. Sec'y of Health & Human Servs., 515 F.3d 1343, 1352 (Fed. Cir. 2008).
a. Interim Fee Awards are Appropriate Under the Vaccine Act
The Federal Circuit has concluded that interim fee awards are permissible and
appropriate under the Vaccine Act. Shaw v. Sec’y of Health & Human Services, 609
F.3d 1372 (Fed. Cir. 2010); Avera, 515 F.3d at 1352. In Avera, the Federal Circuit
stated, “[i]nterim fees are particularly appropriate in cases where proceedings are
protracted and costly experts must be retained.” Id. In denying an interim fee award,
the Avera court reasoned, “The amount of fees here was not substantial; appellants had
not employed any experts; and there was only a short delay in the award pending the
appeal.” Id. In Shaw, the Federal Circuit clarified that “where the claimant establishes
that the cost of litigation has imposed an undue hardship and there exists a good faith
basis for the claim, it is proper for the special master to award interim attorneys’ fees.”
609 F.3d at 1375.
b. Interim Fees are Appropriate in this Case
Special Master Millman previously found that petitioners had reasonable basis to
bring their petition and the petition was brought in good faith. Special Master Millman
granted petitioners’ first application for interim attorneys’ fees and costs, finding an
interim award appropriate “because waiting for the conclusion of the case would place
an undue hardship on petitioners.” Kottenstette v. Sec’y of Health & Human Servs., No.
15-1016V, 2017 WL 5662780, at *3 (Fed. Cl. Spec. Mstr. Oct. 30, 2017). I agree with
Special Master Millman’s assessment. Moreover, upon my own review of the record,
nothing in the subsequent history of this case suggests that reasonable basis or good
faith ever came into doubt. Indeed, petitioners prevailed on entitlement before Special
Master Millman shortly after petitioners’ first application for interim attorneys’ fees and
costs.
Additionally, petitioners’ second application for interim attorney’s fees and costs
reflects fees and costs incurred during a separate phase of this litigation, wherein the
parties engaged expert life care planners over a period of a year and a half as they
sought to resolve the appropriate amount of compensation in this case. Regardless of
outcome, respondent’s currently pending motion for review, which seeks review of the
entitlement ruling, inevitably adds an indefinite period of further litigation before
3
complete resolution of this case.4 Thus, although successive motions for awards of
interim fees are disfavored, I find a second interim award is reasonable in this case.
B. Reasonableness of Requested Attorneys’ Fees and Costs
The Federal Circuit has approved the lodestar approach to determine reasonable
attorneys’ fees and costs under the Vaccine Act. Avera, 515 F.3d at 1347. This is a
two-step process. Id. at 1347-48. First, a court determines an “initial estimate . . . by
‘multiplying the number of hours reasonably expended on the litigation times a
reasonable hourly rate.’” Id. (quoting Blum v. Stenson, 465 U.S. 886, 888 (1984)).
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.
a. Reasonable Attorneys’ Fees
It is “well within the special master’s discretion” to determine the reasonableness
of fees. Saxton v. Sec’y of Health & Human Servs., 3 F.3d 1517, 1521-22 (Fed. Cir.
1993); see also Hines v. Sec’y of Health & Human Servs., 22 Cl. Ct. 750, 753 (1991)
(“[T]he reviewing court must grant the special master wide latitude in determining the
reasonableness of both attorneys’ fees and costs.”). Applications for attorneys’ fees
must include contemporaneous and specific billing records that indicate the work
performed and the number of hours spent on said work. See Savin v. Sec’y of Health &
Human Servs., 85 Fed. Cl. 313, 316-18 (2008). Such applications, however, should not
include hours that are “‘excessive, redundant, or otherwise unnecessary.’” Saxton, 3
F.3d at 1521 (quoting Hensley v. Eckerhart, 461 U.S. 424, 434 (1983)). Special
masters can reduce a fee request sua sponte, without providing petitioners notice and
opportunity to respond. See Sabella v. Sec’y of Health & Human Servs., 102 Fed. Cl.
719, 729 (2011). Furthermore, a special master need not engage in a line-by-line
analysis of petitioner’s fee application when reducing fees. Broekelschen v. Sec’y of
Health & Human Servs., 102 Fed. Cl. 719, 729 (2011).
i. Hourly Rates
A reasonable hourly rate is “the prevailing market rate defined as the rate
prevailing in the community for similar services by lawyers of reasonably comparable
skill, experience, and reputation.” Avera, 515 F.3d at 1348 (citation and quotation
omitted). In Avera, the Federal Circuit found that in Vaccine Act cases, the special
master should use the rate prevailing in the forum, i.e., Washington, D.C., in
determining an award of attorneys’ fees unless the bulk of the work is completed
outside of the forum and there is a “very significant difference” between the forum hourly
rate and the local hourly rate. 515 F.3d at 1349 (citing Davis County Solid Waste Mgmt.
& Energy Recovery Spec. Serv. Dist. v. U.S. Envtl. Prot. Agency, 169 F.3d 755 (D.C.
Cir. 1999)).
4Notably, on October 7, 2019, Judge Firestone ordered the parties to show cause why the case should
not be stayed pending a potentially relevant decision by the Federal Circuit. (ECF No. 115.)
4
The decision in McCulloch provided a further framework for consideration of
appropriate ranges for attorneys’ fees based upon the experience of the practicing
attorney. McCulloch v. Sec’y of Health & Human Servs., No. 09-293V, 2015 WL
5634323, at *19 (Fed. Cl. Spec. Mstr. Sept. 1, 2015), motions for recons. denied, 2015
WL 6181910 (Fed. Cl. Spec. Mstr. Sept. 21, 2015). The Office of Special Masters has
since updated the McCulloch rates, and the Attorneys’ Forum Hourly Rate Fee
Schedules for 2015-2016, 2017, 2018, and 2019 can be accessed online.5
In this case, Special Master Millman previously determined Mr. McHugh's hourly
rate to be $430 for 2017, despite petitioners’ request for $445 per hour for
2017. Kottenstette, No. 15-1016V, 2017 WL 5662780, at *4. Special Master Millman
set this hourly rate in conformance with the 2017 forum rate range for attorneys with
more than 31 years of experience. Notably, however, Special Master Millman did not
award Mr. McHugh the top rate. Citing Hirmiz v. Secretary of Health & Human Services,
No. 06-371, 2017 WL 4277433 (Fed. Cl. Spec. Mstr. Aug. 29, 2017), she explained that
Mr. McHugh's experience and competence are not significantly greater than they have
previously been, and thus did not warrant a higher rate.
Consistent with Special Master Millman’s prior decision, Mr. McHugh continues
to request a rate of $430 per hour for 2017. Moreover, notwithstanding petitioners’
request in their application for an hourly rate of $445 for 2018, Mr. McHugh submitted
billing records that reflect a rate of $430 for work performed in 2018. Accordingly,
although I am awarding the full amount of the interim attorneys' fees requested for 2017
and 2018, I am not reaching the question of whether the requested rate for 2018 is
reasonable since Mr. McHugh has not actually billed at that rate.
The rate Mr. McHugh is requesting for 2019, however, is excessive. Mr. McHugh
seeks $465 per hour, whereas the Fee Schedule for 2019 suggests a maximum rate of
$464 per hour for attorneys with Mr. McHugh's level of experience. Moreover, Special
Master Millman deliberately declined to award maximum 2017 rates to Mr. McHugh on
his prior motion for interim fees based on his experience and competency.
Upon my own review of the docket, I see nothing that would suggest that Mr.
McHugh's rates should be substantially increased over the previously awarded rates in
this case or that counsel's experience and competency have significantly changed over
the remaining course of the case. Petitioners’ only argument for why counsel's rates
should be increased over the previously accepted 2017 rate is citation to the updated
fee schedule for 2019. By applying the same growth rate utilized by the Office of
Special Masters fee schedules (i.e. the PPI-OL) to Mr. McHugh's 2017 rate, I find that
an appropriate rate for 2019 is $454 per hour.
5 Each of the Fee Schedules for 2015 through 2019 can be accessed at
http://www.cofc.uscourts.gov/node/2914. The hourly rates contained within the schedules are derived
from the decision in McCulloch, 2015 WL 5634323. The schedules for 2017, 2018, and 2019 are adjusted
for inflation using the Producer Price Index for Offices of Lawyers (“PPI-OL”).
5
ii. Hours Expended
Special masters may rely on their experience with the Vaccine Program to
determine the reasonable number of hours expended. Wasson v. Sec’y of Health &
Human Servs., 24 Cl. Ct. 482, 484 (1991), rev’d on other grounds and aff’d in relevant
part¸ 988 F.2d 131 (Fed. Cir. 1993). It is “well within the special master’s discretion to
reduce the hours to a number that, in his experience and judgment, [is] reasonable for
the work done.” Saxton, 3 F.3d at 1521. For example, special masters have previously
reduced the fees paid to petitioners due to excessive and duplicative billing. See
Ericzon v. Sec’y of Health & Human Servs., No. 10-103V, 2016 WL 447770 (Fed. Cl.
Spec. Mstr. Jan. 15, 2016) (reduced overall fee award by 10 percent due to excessive
and duplicative billing); Raymo v. Sec’y of Health & Human Servs., No. 11-654V, 2016
WL 7212323 (Fed. Cl. Spec. Mstr. Nov. 2, 2016) (reduced overall fee award by 20
percent), mot. for rev. denied, 129 Fed. Cl. 691 (2016).
After reviewing the billing records, I find the hours billed for work performed in
2017 and 2018 to be reasonable. However, I find the hours Mr. McHugh billed for
working on petitioners’ response to respondent’s motion for review excessive. This
work was performed in June and July of 2019.
Mr. McHugh has a history of overbilling for written briefing. For example, in R.K.,
Mr. McHugh billed 153.5 hours working on petitioner’s motion for review which resulted
in a 66-page motion. R.K. v. Sec’y of Health & Human Servs., No. 03-632V, slip op.
(Fed. Cl. Spec. Mstr. Aug. 31, 2017).6 The special master in that case found the
requested hours excessive and reduced Mr. McHugh’s requested hours for the motion
by 50%, noting that Mr. McHugh should have mastered the facts and arguments of the
case during the preceding litigation and citing to other cases with similarly complicated
histories where a motion for review was pursued with substantially fewer hours billed.7
Id. at 10 (citing Caves v. Sec’y of Health & Human Servs., No. 07-443V, 2012 WL
6951286 (Fed. Cl. Spec. Mstr. Dec. 20, 2012) (noting that a 30-page motion for review
was completed in 49.8 attorney hours); Morse v. Sec’y of Health & Human Servs., 93
Fed. Cl. 780 (2010) (noting that a survey of fee awards for motions for review showed
billings of between 6.25 and 80 hours per instance); Doe v. Sec’y of Health & Human
Servs., 89 Fed. Cl. 661 (2009) (finding 160.2 hours of attorney work reasonable for
persecuting two motions for review)). In Mostovoy, the special master noted that Mr.
McHugh’s billing records included excessive time devoted to unspecified motions and
reduced his fees for what was determined to be vague and excessive block billing.
Mostovoy v. Sec’y of Health & Human Servs., No. 02-10V, 2016 WL 720969, at *5-6
(Fed. Cl. Spec. Mstr. Feb. 4, 2016).
6 https://cofc-ecf.sso.dcn/cgi-bin/show_public_doc?2003vv0632-377-0.
7 In R.K., the special master also found significant that “the final work product was very poor” and
included previously addressed allegations and extensive use of block quotes of expert reports. R.K., No.
03-632V, slip op. at 11.
6
Here, Mr. McHugh billed 68.1 hours working on petitioners’ motion response,
which resulted in a 23-page document. Notably, Mr. McHugh had already billed over 30
hours for the drafting of post-hearing briefs and more than eight hours of the time billed
for petitioners’ response to respondent’s motion for review were dedicated to reviewing
those prior submissions. Given Mr. McHugh’s experience and familiarity with this case,
and with the Vaccine program overall, I find the hours billed for the preparation of
petitioners’ response to respondent’s motion for review excessive and reduce the
requested hours by 50%. This results in a reduction of 34.05 hours from the interim
attorneys’ fees application. Accordingly, Mr. McHugh’s award is based on 48.96 hours
of work performed in 2019.
b. Attorneys’ Costs
Attorneys’ costs must be reasonable as well. See Perreira v. Sec’y of Health &
Human Servs., 27 Fed. Cl. 29, 34 (1992) (“The conjunction ‘and’ conjoins both
‘attorneys’ fees’ and ‘other costs’ and the word ‘reasonable’ necessarily modifies both.
Not only must any request for reimbursement of attorneys’ fees be reasonable, so also
must any request for reimbursement of costs.”). Petitioners requested $15,545.95 in
interim attorneys’ costs for work performed by petitioners’ life care planner, Paramount
Solutions, Inc. and petitioners’ expert, Dr. Marcel Kinsbourne. Upon review of the
submitted documentation, I find that the requested costs are reasonable except for the
costs expended seeking consultation from Dr. Kinbourne in drafting petitioners’
response to respondent’s motion for review.
Petitioners’ represented that “Dr. Kinsbourne was consulted with regard to the
motion for review due to his long experience with this program and with the medical
issues in question in this case.” (ECF No. 111, p. 3.) However, upon my review of
petitioners’ response to respondent’s motion for review, the content of the brief appears
to be legal in nature. Although the record evidence is marshalled, it is discussed in
relation to this Program’s standards of adjudication and prior caselaw, which is the
purview of petitioners’ counsel, not Dr. Kinsbourne. It is not apparent on the face of
petitioners’ response how or why Dr. Kinsbourne’s participation would have been
reasonable. Moreover, Dr. Kinsbourne's bill reflects that he was called upon to do
"research." (ECF No. 111, Ex. 2, p. 9.) However, it would not normally be appropriate
for petitioners to introduce new expert evidence in response to a motion for review and
petitioners have not provided any explanation for why this motion might otherwise
warrant such research. Accordingly, I do not find the expenditure on expert research to
be reasonable. A reduction of $1,250 from the interim attorneys’ costs award results.
III. CONCLUSION
In light of the above, petitioners’ second application for interim attorneys’ fees
and costs is GRANTED with reductions as follows:
Requested Awarded
7
Interim Attorneys’ Fees for 2017 $15,257.83 $15,257.83
Interim Attorneys’ Fees for 2018 $5,253.17 $5,253.17
Interim Attorneys’ Fees for 2019 $38,599.65 $22,227.848
Interim Paralegal Fees for 2019 $187.50 $187.50
Total Interim Attorneys’ Fees $59,298.15 $42,926.34
Total Interim Attorneys’ Costs $15,545.95 $14,295.95
Total Interim Attorneys’ Fees and Costs $74,844.10 $57,222.29
Accordingly, petitioners are awarded $57,222.29, representing $42,926.34 in
attorneys’ fees and $14,295.95 in attorneys’ costs, in the form of a check made payable
jointly to petitioners and John McHugh, Esq.
In the absence of a motion for review filed pursuant to RCFC Appendix B, the
clerk of the court is directed to enter judgment herewith.9
IT IS SO ORDERED.
s/Daniel T. Horner
Daniel T. Horner
Special Master
8 As explained above, for work performed in 2019, Mr. McHugh is awarded 48.96 hours at $454 an hour,
totaling $22,227.84, a reduction of $16,371.81.
9Entry of judgment can be expedited by each party’s filing of a notice renouncing the right to seek review.
Vaccine Rule 11(a).
8