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USA ex rel. Donald Palmer v. C&D Technologies Inc, 17-2350 (2018)

Court: Court of Appeals for the Third Circuit Number: 17-2350 Visitors: 28
Filed: Jul. 17, 2018
Latest Update: Mar. 03, 2020
Summary: PRECEDENTIAL UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT _ No. 17-2350 _ UNITED STATES OF AMERICA, ex rel. DONALD PALMER v. C&D TECHNOLOGIES, INC. Donald Palmer, Appellant _ On Appeal from the United States District Court for the Eastern District of Pennsylvania (D.C. Civ. Action No. 2:12-cv-00907) District Judge: Honorable Gene E. K. Pratter _ Submitted Under Third Circuit L.A.R. 34.1(a) March 13, 2018 Before: JORDAN, KRAUSE, and GREENBERG, Circuit Judges (Filed: July 17, 2018) Ross B
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                                     PRECEDENTIAL

     UNITED STATES COURT OF APPEALS
          FOR THE THIRD CIRCUIT
              ______________

                    No. 17-2350
                  ______________

 UNITED STATES OF AMERICA, ex rel. DONALD
                PALMER

                          v.

            C&D TECHNOLOGIES, INC.

                    Donald Palmer,
                        Appellant
                  ______________

On Appeal from the United States District Court for the
           Eastern District of Pennsylvania
       (D.C. Civ. Action No. 2:12-cv-00907)
    District Judge: Honorable Gene E. K. Pratter
                  ______________

    Submitted Under Third Circuit L.A.R. 34.1(a)
                 March 13, 2018

Before: JORDAN, KRAUSE, and GREENBERG, Circuit
                    Judges

                (Filed: July 17, 2018)
Ross Begelman
Marc Orlow
Begelman & Orlow
411 Route 70 East, Suite 245
Cherry Hill, N.J. 08034

James B. Helmer, Jr.
Paul B. Martins
James A. Tate
Helmer, Martins, Rice &
Popham Co.
600 Vine Street, Suite 2704
Cincinnati, OH 45202

   Attorneys for Appellant

Paula C. Cedillo
Charles D. Ray
Thomas J. Finn
McCarter & English
185 Asylum Street
CityPlace I, 36th Floor
Hartford, CT 06103

Katelyn Gillece
Michael J. Glasheen
McCarter & English
1600 Market Street
Suite 3900
Philadelphia, PA 19103

   Attorneys for Appellee




                               2
                        ______________

                  OPINION OF THE COURT
                      ______________

GREENBERG, Circuit Judge.

        In this action under the False Claims Act, 31 U.S.C. §§
3729-3733 (2012), Donald Palmer (“Relator”) settled his claim
with defendant C&D Technologies, Inc. (“C&D”), thereby
entitling Relator to reasonable attorneys’ fees and costs. 
Id. § 3730(d)(2).1
The parties, however, were unable to reach an
agreement on attorneys’ fees. In contesting the fees, both
parties adopted unproductive tactics and strayed from
professional etiquette, conduct that ultimately caused the
District Court to proclaim that “[i]t is a hellish judicial duty to
review and resolve disputed attorneys’ fee petitions,
particularly in cases, like this one, where the adversaries fan
the flames at virtually every opportunity.” App. 8. While
Relator sought $3,113,530.50 in fees, the Court reduced that
amount to $1,794,427.27.2 Relator timely appealed from orders

1
  Relator filed this action under seal and was able to prosecute
the action when the Government declined to intervene. See 31
U.S.C. § 3730(b)(4)(B).
2
  Relator’s total fee demand was $3,278,115.99, of which
$3,113,530.50 was for statutory fees and the balance of
$164,585.49 was for costs. The parties agree that costs owed
to Relator amount to $164,585.49. Thus, that figure is not at
issue in this appeal.



                                3
that the Court entered on April 25, 2017, and May 24, 2017,
awarding fees and costs. We will remand on one narrow
ground, but otherwise affirm the Court’s orders in all other
respects.


                          I. FACTS

       A. Background

        In this False Claims Act action, Relator claimed that
C&D manufactured and shipped some 349 defective batteries
to the United States government for use in intercontinental
ballistic missile launch controls. In the summer of 2014, after
some four years of litigation, the parties engaged in active
mediation. Relator subsequently demanded a settlement of
$1.5 million, plus fees and costs, and the negotiations ended
without success.

        Then, in the spring of 2015, Relator filed a Second
Amended Complaint in which he expanded his demands for
alleged damages to $30 million, or twenty times the amount of
his initial demand. After the District Court denied cross-
motions for summary judgment, the parties settled the case for
$1.7 million, representing about six percent of the total amount
that the Relator demanded in his Second Amended Complaint.
        B. Attorneys’ Fees Dispute

       As a statutory matter, the settlement made Relator a
prevailing party under the False Claims Act, entitling him to
an award of “reasonable attorneys’ fees and costs.” 31 U.S.C.
§ 3730(d)(2) (emphasis added). Although the parties settled
the merits of the case, they were not able to agree on the fees



                               4
that Relator should recover.           Initially Relator sought
$2,367,904.85 in attorneys’ fees as of December 31, 2015. As
the District Court explained, “C&D responded that the
reasonable fee amount should have been no more than about
half that amount, arguing essentially that the case had been
over-staffed and over-worked by the Relator’s various sets of
lawyers, and that the fee petition was based on the wrong
hourly rates and included duplicative entries, inappropriate
submissions such as for travel time, and, finally, that there
should be a reduction of the amount awarded for degree of
success, or rather, lack of success, given the modest settlement
amount.” App. 10.

      According to the District Court, both parties’ counsel
were uncooperative and did not act in good faith:

              The Court repeatedly offered
              certain guidance for possibly
              bridging the chasm and directed
              the parties’ counsel to exchange
              various pertinent information in an
              effort to minimize areas of
              disagreement.       Counsel were
              equally slow to do so, and the
              hoped for exercise that the Court
              intended as a way to persuade
              counsel of the benefits of good
              faith and good sense achieved very
              little – other than to lead to an
              exchange [of] dueling briefs,
              innuendo and insults.

App. 10.




                               5
       Relator responded to C&D’s objections by increasing
his fee demand to $3,278,115.99, or, as the District Court
observed, “almost $1 million more than the fees [he] sought a
year ago and almost twice the dollar amount of the settlement
[he] reached.” App. 11. Notably, Relator opted to apply
hourly rates that he “extrapolated” from actual Community
Legal Services (“CLS”) rates and which were higher than those
that he originally used to calculate his fee demand. App. 11.

       C. The District Court’s Rulings

       In its decision, the District Court emphasized that it
“was at all times well aware of who was doing what, to what
possible end and [had] been entirely attentive to the at times
puzzling performance of the professional duties of the
lawyers.” App. 11. The Court noted that its resolution of the
fee award reflected its “hands-on contemporaneous evaluation
(and necessary attendant factual findings) of the services
performed and for which payment is sought.” App. 11. It
found that, “[i]n the main, . . . C&D’s opposition to the fee
petition adopts most of the Court’s guidance as to, for lack of
a better term, ‘lawyer hours’ and acceptable rates for various
tasks undertaken.” App. 11 n.6. It then proceeded to resolve
the areas in dispute.

              i. Hourly Rates

       The parties and the District Court agreed that the rate
issue was “best resolved by using primarily – if not exclusively
– the rates promulgated by the Philadelphia office of
Community Legal Services.” App. 15 (citing Maldonado v.
Houstoun, 
256 F.3d 181
, 187-88 (3d Cir. 2001) (“The fee




                                6
schedule established by [CLS] has been approvingly cited by
the Third Circuit as being well developed and has been found
by [the Eastern District of Pennsylvania] to be a fair reflection
of the prevailing market rates in Philadelphia.” (second
alteration in original) (quotation marks and citation omitted)).
The Court rejected Relator’s “extrapolated” rates that were
higher than the CLS rates because “the CLS rates promulgated
in 2014 remain the actual current rates; neither CLS nor any
court in any reported opinions that this Court has been able to
locate have resorted to the ‘extrapolation’ technique now used
by [Relator’s] counsel.” App. 16. Because the CLS rates
provided a range—rather than a specific dollar amount—for
reasonable hourly rates, the Court elected “to take an equitable
approach” and “direct[ed] counsel to use for each time-keeper
for whom a fee is sought and permitted an hourly rate at the
mid-point of the applicable range.” 
3 Ohio App. 16
.

              ii. Reasonableness of Hours Claimed



       The District Court reduced Relator’s recoverable
attorney hours for, inter alia, depositions, document review,
summary judgment motions, a motion for reconsideration,
Daubert motions, and travel time expenses.

                     1. Depositions

3
  For example, the 2014 CLS rate range is $600 to $650 per
hour for an attorney with twenty-five years or more of
experience – thus, the hourly rate for Relator’s attorneys who
meet such criteria would be $625, the mid-way point between
the low and high points of the CLS range.



                               7
       In regard to depositions, C&D objected both to the
number of hours involved in taking and preparing for
depositions, as well as the number of attorneys attending some
of those depositions on behalf of Relator. In its decision, the
District Court remarked that during its various meetings
regarding the fee dispute, it had “frequently addressed the
matter of the crowd of counsel at the depositions and in
preparation sessions for them.” App. 17.

        Based on previous guidance that it had issued to the
parties, the District Court permitted Relator to receive fees for
the twelve depositions that C&D specifically challenged, but
limited those fees in each deposition to those generated by the
Relator lawyer who actually did the questioning and one other
Relator lawyer actually in attendance. The Court also allowed
“[p]rep time compensation” for each deposition of one lawyer
per deposition (i.e., the lawyer who actually logged preparation
time for the deposition), “up to a maximum of 1.75 preparation
hours per hour of documented deposition time.” App. 17. If
less than 1.75 hours/deposition hour was recorded, then the
lesser time value had to be used.4
                       2. Summary Judgment and
                       Reconsideration Motions

      C&D identified more than 900 hours and more than
$440,000 in fees submitted by Relator for: (1) filing a motion
for summary judgment; (2) responding to C&D’s motion for
summary judgment; (3) arguing the motions; and (4)

4
 For example, for a three-hour deposition, up to 5.25 hours of
prep time may be charged or the actual prep time logged,
whichever is less.



                               8
responding to C&D’s motion for reconsideration. The District
Court stated that it “cannot avoid observing that the number of
hours attributed to the Relator’s own motion (284.15) comes
within a day’s worth of the number of hours counsel then
charged for defending against the C&D opposing motion
(291.20).” App. 19.

       The District Court was troubled by this reality because
“one would reasonably expect that at least a good portion of
the work undertaken to plow the legal field for advancing a
summary judgment motion would be (or at least should be)
useful and usable for defending an opposing motion (or vice
versa), especially for lawyers (such as those representing
Relator here) with a self-proclaimed expertise in the
controlling legal issues.” App. 20. In regard to oral argument,
the Court was “puzzled as to how Relator’s counsel can call for
compensation for 121.2 hours for this activity, slightly more
than 48 times the length of the entire time in court for both
parties’ arguments, including pleasantries.” App. 20. As to
Relator’s response to C&D’s motion for reconsideration, the
Court found that there was “no credible description as to why”
counsel devoted some seventy-eight hours to “address[] the 5-
page motion[.]” App. 21.

        In the end, the District Court—based on its “knowledge
of the issues and the briefs as well as having discretion to apply
its knowledge gleaned from managing the case from start to
finish”—allowed: (1) sixty percent of the time claimed for
preparation of Relator’s motion for summary judgment; (2)
fifty percent of the time claimed for preparation of Relator’s
opposition to C&D’s motion for summary judgment; (3) thirty
percent of the time claimed for Relator’s reply brief; (4) a total
of 42.5 hours for two lawyers to prepare for and one lawyer to




                                9
conduct oral argument; and (5) twenty-five hours to respond to
C&D’s motion for reconsideration. App. 20-21.

                     3. Daubert Motions

       C&D challenged as unreasonable Relator’s claim for
203 hours and more than $85,000 in fees in connection with
Relator’s Daubert motion and his opposition to two such
motions filed by C&D.5 The District Court agreed with C&D.
Accordingly, the Court reduced the charges by $58,106.56.

                     4. Travel Time

       Relator sought fees of 247.70 hours and $129,526.75 for
travel time logged by two of Relator’s attorneys based in
Cincinnati. C&D objected and posited that the travel time be
reduced by half. However, the District Court recognized that
this Court has held that, “under normal circumstances, a party
that hires counsel from outside of the forum of the litigation
may not be compensated for travel time, travel costs, or the
costs of local counsel.” App. 22 (quoting Hahnemann Univ.
Hosp. v. All Shore, Inc., 
514 F.3d 300
, 311 (3d Cir. 2008)).
Thus, following Hahnemann, the Court held that, “to the extent
that Relator’s out-of-forum counsel seek reimbursement for
travel time to and from the forum – for instance, for court
appearances – that travel time will not be reimbursed.” App.
23.

       However, the District Court treated “depositions held
outside of the forum differently, as even counsel located in the

5
 Daubert v. Merrell Dow Pharm., Inc., 
509 U.S. 579
, 
113 S. Ct. 2786
(1993).



                              10
forum area would have incurred travel time for those events.”
App. 23. It explained:

              [W]hile the Court is disinclined to
              allow a claim for multiple lawyers
              to be traveling on someone else’s
              ticket or for any lawyer to charge
              ‘full freight’ for any travel, the
              Court is equally mindful that but
              for a professional obligation the
              lawyer likely would not be
              traveling at all, in which case the
              lawyer at least theoretically would
              have been able to enjoy other
              pursuits.      Thus, some time-
              oriented compensation for travel
              time is fair for non-forum events in
              the case, though the Court is
              discinclined        to    authorize
              companion traveling for events
              ultimately attended by multiple
              counsel.

App. 23 (footnote omitted). Noting that neither party had
provided evidence of practices relating to fees for travel time
in the local community, the Court held that, “[b]ecause the
burden is squarely on Relator to show that the fees he requests
are reasonable, Relator will bear the weight of this failure.”
App. 24. Accordingly, the Court ordered that travel time at
fifty percent would be allowed for two attorneys to attend
events occurring outside the forum area.

              iii. “Success” or “Benefits Achieved” Factors




                              11
        C&D argued for a twenty percent reduction of the fee
award based on Relator’s lack of success. See Hensley v.
Eckerhart, 
461 U.S. 424
, 436, 
103 S. Ct. 1933
, 1941 (1983)
(holding that the “degree of success obtained” is “the most
critical factor” in deciding whether to adjust a fee award). The
District Court recognized that “Relator and his counsel
achieved only very modest results: a $1.7 million monetary
settlement payment which was about 6% of the Relator’s
demand in his Second Amended Complaint and roughly
$200,000 more than the first settlement demand at the start of
the case in 2014.” App. 25. The Court concluded that, “after
balancing the arguments, the applicable burdens, the Court’s
knowledge of the case and counsel’s conduct, and the
foregoing reductions, . . . the appropriate exercise of discretion
is to further reduce the fee to be awarded to 90% of the
permissible fee calculated once the reductions imposed in this
ruling have been applied.” App. 26. Accordingly, the Court
reduced the fee by ten percent.

           D. Judgment and Appeal

        In light of the District Court’s decision, the parties filed
a joint submission regarding Relator’s attorneys’ fees on May
23, 2017. The parties agreed that for the purposes of the fee
award, the Court could use $1,794,427.27 for fees and
$164,585.49 for costs, the sum of which was $1,959,012.76.
The Court entered judgment on the basis of this stipulation.
Relator timely appealed from the fee award, arguing that he is
entitled to $564,599.12 in additional fees.




                                12
                      II. DISCUSSION6

        On appeal, Relator contends that the District Court erred
by reducing the billable rates and portions of the fee award that
relate to various motions, depositions, and travel expenses.7
For the reasons below, we will remand this case only for the
Court to decide whether the “fees on fees” that Relator seeks
to collect are reasonable and whether they should be reduced
based on the results obtained. We will affirm the Court’s
judgment in all other respects.

       A. Awards Below C&D’s Suggestions

       The District Court reduced the hourly rates and
attorneys’ hours related to both travel expenses and Relator’s
reply brief to an amount below that that C&D suggested. We
review de novo to determine whether the Court was able to
reduce the attorneys’ fees beyond the reductions suggested by
C&D. See Planned Parenthood of Cent. N.J. v. Att’y Gen. of
N.J., 
297 F.3d 253
, 265 (3d Cir. 2002) (“We review de
novo the standards and procedures applied by the District
Court in determining attorneys’ fees, as it is a purely legal
question.”). Relator contends that the Court acted sua sponte
and committed reversible error. We disagree and find that the

6
  The District Court had jurisdiction over this matter pursuant
to 28 U.S.C. § 1331 and 31 U.S.C. § 3732(a). We have
jurisdiction pursuant to 28 U.S.C. § 1291.
7
  On appeal, Relator does not challenge the District Court’s
decision to reduce the fee award by ten percent due to the
minimal benefits that counsel achieved or its decision to limit
recoverable document review time to 185 hours.



                               13
Court appropriately exercised its discretion in doing so.

       According to Relator, the District Court’s discretion to
award attorneys’ fees is restricted by the parties’ positions of
what is reasonable, and it therefore cannot award an amount
below that which the party opposing the fees contends is
reasonable. He relies on Bell v. United Princeton Properties,
Inc., 
884 F.2d 713
(3d Cir. 1989), for his proposition that “a
court may not sua sponte reduce the amount of the award when
the defendant has not specifically taken issue with the amount
of time spent or the billing rate[.]” Appellant Br. at 8-9
(quoting 
Bell, 884 F.2d at 720
). Relator contends that this
Court prohibits fee award reductions that were not sought by
the opposing party for two reasons:

              In so deciding, we reasoned first
              that sua sponte reduction of a fee
              request deprives the fee applicant
              of her entitlement to . . . offer
              evidence in support of the
              reasonableness          of      her
              request. And second, because
              statutory    fee     litigation   is
              adversarial litigation, there is no
              need to allow the district court to
              reduce a fee award on its own
              initiative.

Appellant Br. at 10 (quoting 
Bell, 884 F.2d at 719
) (citation
and internal quotation marks omitted).

       Here, the District Court reduced, in three instances,
Relator’s fee award by more than the amount suggested by




                              14
C&D. First, C&D argued before the Court that the hourly rates
on the high end of the CLS ranges were adequate to
compensate Relator, but the Court determined that the hourly
rate would constitute the midpoint—rather than the high end—
of the CLS rate range. Second, C&D sought a reduction of
fifty percent for travel time to the forum by counsel based
outside the forum. The Court disallowed all such travel time
because it was bound by Hahnemann.8 Third, C&D proposed
that 50 hours would be sufficient for Relator to prepare an
adequate reply brief. The Court, however, allowed recovery of

8
  Relator relies on, inter alia, Planned Parenthood of Central
New Jersey for the proposition that “there is no blanket
prohibition against compensating travel to the forum[.]”
Appellant Br. at 13. In Planned Parenthood, we stated that
“travel time is an out-of-pocket expense under § 1988 that is
generally recoverable ‘when it is the custom of attorneys in the
local community to bill their clients separately for 
[it].’” 297 F.3d at 267
(alteration in original) (quoting Abrams v.
Lightolier Inc., 
50 F.3d 1204
, 1225 (3d Cir. 1995)). Thus,
Planned Parenthood applies to local counsel, see 
id., while Hahnemann
prohibits travel expenses for “counsel from
outside of the forum of the 
litigation,” 514 F.3d at 312
. Here,
Relator sought fees for travel time logged by counsel from
outside the forum: accordingly, Hahnemann—and not Planned
Parenthood—is on point. Regardless, even under Planned
Parenthood, “a court must look to the practice in the local
community” to determine whether travel time should be
compensated at the full 
rate. 297 F.3d at 267
. Here, Relator—
who has the burden to prove that the fees are reasonable, see
Rode v. Dellarciprete, 
892 F.2d 1177
, 1183 (3d Cir. 1990)—
has not presented any evidence regarding the customary
practice for the billing of travel time in the local community.



                              15
thirty percent of the 127 hours that Relator’s attorneys billed,
or thirty-eight hours.

        We reject Relator’s argument and affirm the District
Court’s reduction of its fee award in the aforementioned
instances by more than had been argued for by C&D. The
Court’s determination of reasonable hourly rates and the
reduction of fees for the summary judgment reply brief and
travel time cannot be characterized as sua sponte rulings as
Relator suggests. Clearly, C&D objected to the fees at issue
given that Relator argues the Court improperly reduced fees
beyond what had been suggested by C&D in its objection – as
such, the Court did not act sua sponte. The prohibition against
the reduction of attorneys’ fees occurs only when the amount
remains “uncontested” – which is not the case here.
Cunningham v. City of McKeesport, 
753 F.2d 262
, 267 (3d Cir.
1985), vacated on other grounds, 
478 U.S. 1015
, 
106 S. Ct. 3324
(1986); see also 
Bell, 884 F.2d at 720
(“[T]he two
justifications for disallowing sua sponte fee reductions . . .
mandate only that a judge not decrease a fee award based on
factors not raised at all by the adverse party.” (emphasis
added)).


       Furthermore, Relator does not cite any decision that
requires a district court to award at a minimum the amount of
attorneys’ fees that the opposing party contends is reasonable,
and we decline to make such a ruling today. Rather, our case
law provides district courts with substantial discretion to
determine what constitutes reasonable attorneys’ fees because
they are “better informed than an appellate court about the
underlying litigation and an award of attorney fees is fact
specific[.]” Pub. Interest Research Grp. of N.J., Inc. v.




                              16
Windall, 
51 F.3d 1179
, 1184 (3d Cir. 1995); see also Rode v.
Dellarciprete, 
892 F.2d 1177
, 1183 (3d Cir. 1990) (“Once the
adverse party raises objections to the fee request, the district
court has a great deal of discretion to adjust the fee award in
light of those objections.”). Indeed, in Bell—the very case on
which Relator relies—we recognized that “the type of
reduction made by the court [need not] be exactly the same as
that requested by the adverse party” so long as: (1) “the fee
applicant is given sufficient notice to present his or her
contentions with respect to the reduction that the district court
ultimately makes”; (2) “any reduction is based on objections
actually raised by the adverse party”; and (3) “the district court
. . . provide[s] a concise but clear explanation of its reasons for
the fee 
award.” 884 F.2d at 721-23
(internal quotation marks
omitted). Accordingly, we conclude that, in making an award
of attorneys’ fees that abides by those criteria, a court does not
per se abuse its discretion when its award is below the amount
that the opposing party accepts as reasonable.

       Each of the District Court’s reductions meets these
benchmarks. C&D filed objections to the hourly rates, travel
time, and summary judgment hours, which put Relator on
notice as to those very topics. C&D’s underlying objections—
that Relator’s proposed rates superseded the CLS rates, that
counsel from outside the forum is not typically compensated
for travel, and that Relator’s counsel billed an inconceivable
number of hours for the summary judgment reply brief—each
motivated the Court’s decisions.9 And the Court permissibly

9
  See, e.g., App. 16 (“Mr. Palmer’s lawyers’ fee application
will be adjusted so that only the published 2014 CLS rates may
be used.”); App. 20 (“[O]ne would reasonably expect that at
least a good portion of the work undertaken to plow the legal



                                17
relied on its knowledge of the case and the parties, in addition
to what it regarded as the inflated amount of hours billed by
Relator’s counsel, to reach its conclusions.10 See 
Bell, 884 F.2d at 721
(“In determining whether the fee request is excessive in
light of particular categorical contentions raised by the adverse
party, and in setting the amount of any reduction, the court will
inevitably be required to engage in a fair amount of ‘judgment
calling’ based upon its experience with the case and its general
experience as to how much time a case requires.”).

       Furthermore, here, after rejecting Relator’s
unsubstantiated “extrapolated” rates that were in excess of the
published CLS rates, the District Court was within its
discretion to apply the mid-point of the CLS rates for a
“reasonable” hourly rate. See Loughner v. Univ. of Pittsburgh,


field for advancing a summary judgment motion would be (or
at least should be) useful and usable for defending an opposing
motion (or vice versa), especially for lawyers (such as those
representing Relator here) with a self-proclaimed expertise in
the controlling legal issues.”); App. 22 (finding that the Court
of Appeals for the Third Circuit ordinarily disallows
compensation for travel costs for counsel from outside the
forum).
10
   See, e.g., App. 20 (“Thus, exercising its knowledge of the
issues and the briefs as well as having discretion to apply its
knowledge gleaned from managing the case from start to
finish, the Court will permit a claim of 60% of the current claim
for the written work recorded for Relator’s motion, 50% of the
time charged for opposing the C&D summary judgment
motion, and 30% of the time recorded for the Relator’s ‘Reply
Brief.’”).



                               18

260 F.3d 173
, 180 (3d Cir. 2001) (“Having rejected the
prevailing party’s evidence of rates, the District Court was free
to affix an adjusted rate.”). In regard to travel time, the Court
properly adhered to our binding legal precedent and disallowed
any travel time. See Hahnemann Univ. 
Hosp., 514 F.3d at 312
.11 And it is logical to assume that the Court applied a lower
multiplier to the hours logged for the preparation for the reply
brief than the main brief because Relator’s reply brief was
significantly shorter and simpler than the main brief.12 See
Bell, 884 F.3d at 721
(“In order to exercise its discretion fairly,
a district court needs flexibility in deciding whether to reduce
a fee request and, if so, by how much.”).

       Accordingly, the District Court did not err by reducing
Relator’s fee award below the amount sought by C&D.


11
   Hahnemann provides for a narrow exception to this rule
“where forum counsel are unwilling to represent 
plaintiff[.]” 514 F.3d at 312
(quoting Interfaith Cmty. Org. v. Honeywell
Int’l, Inc., 
426 F.3d 694
, 710 (3d Cir. 2005)). This exception
is not applicable here because Relator has not produced any
evidence that local counsel was unwilling to take on the case if
not compensated for the travel time.
12
  Relator’s attorneys originally billed 127 hours for the reply
brief. The seventy percent reduction allowed Relator to
recover reply brief fees for thirty-eight hours. 
Id. This reduction
was completely reasonable. Regardless, the amount
of fees that Relator contends were sua sponte reduced with
respect to the reply brief beyond the amount that C&D argued
for in the context of this case was de minimis – only $4,304.48
out of nearly $1.8 million in total attorneys’ fees.



                                19
           B. Deposition Fees

        Relator contends that the District Court improperly
limited the deposition-related fees that he can recover. We
disagree. “We review the District Court’s attorneys’ fees
award for abuse of discretion . . . .” In re Rite Aid Corp. Sec.
Litig., 
396 F.3d 294
, 299 (3d Cir. 2005). An abuse of discretion
“can occur if the judge fails to apply the proper legal standard
or to follow proper procedures in making the determination, or
bases an award upon findings of fact that are clearly
erroneous.” 
Id. (quoting In
re Cendant Corp. PRIDES
Litig., 
243 F.3d 722
, 727 (3d Cir. 2001)); accord Halley v.
Honeywell Int’l, Inc., 
861 F.3d 481
, 488 (3d Cir. 2017).

       In a statutory fees case, “[t]he party seeking attorney’s
fees has the burden to prove that its request for attorney’s fees
is reasonable” by “submit[ting] evidence supporting the hours
worked and rates claimed.” 
Rode, 892 F.2d at 1183
(citation
omitted). “[T]he party opposing the fee award then has the
burden to challenge, by affidavit or brief with sufficient
specificity to give fee applicants notice, the reasonableness of
the requested fee.” 
Id. Once the
challenging party does so,
“the district court has a great deal of discretion to adjust the fee
award in light of those objections.” 
Id. In instances
where a district court reduces an award by
a particular percentage or amount, we have stated:

               [D]istrict courts, in awarding
               attorneys’ fees, may not reduce an
               award by a particular percentage or
               amount (albeit for justifiable
               reasons) in an arbitrary or




                                20
              indiscriminate fashion. If the court
              believes that a fee reduction . . . is
              indicated, it must analyze the
              circumstances      requiring      the
              reduction and its relation to the
              fee, and it must make specific
              findings to support its action.

Gunter v. Ridgewood Energy Corp., 
223 F.3d 190
, 196 (3d Cir.
2000) (second alteration in original) (citation omitted).

        As an initial matter, we conclude that Relator met his
burden by submitting some evidence to support his requested
deposition fees, and C&D satisfied its burden to challenge the
reasonableness of those fees with sufficient specificity.
Regarding the reasonableness of the fees, Relator contends that
the District Court acted in an arbitrary and indiscriminate
manner by limiting the deposition fees: (1) to the time at
deposition for the Relator attorney who did the questioning and
one additional attorney, and (2) “prep time” compensation for
one lawyer who actually logged preparation time for each
deposition, up to a maximum of 1.75 preparation hours per
hour of documented deposition time. C&D counters that those
limitations are reasonable because, prior to “filing of the fee
petition, the parties and the court engaged in an iterative
process . . . [where] the district court provided guidance to the
parties as to what would be considered a reasonable approach,
such as 1.75 hours of preparation time per deposition hour and
the time spent at the deposition itself for two attorneys, unless
Relator could demonstrate that additional attorneys made
material contributions to the deposition.” Appellee Br. at 31.

       The District Court’s decision to limit fees recoverable




                               21
for time at depositions to two attorneys is reasonable in light of
its concern that “the matter of the crowd of counsel at the
depositions” had to be addressed. App. 17. Indeed, the record
reflects that upwards of four attorneys on behalf of Relator
attended straightforward depositions, and Relator failed to
substantiate the need for the excess attorneys to the Court (and
does not attempt to do so on appeal). Accordingly, the Court
did not abuse its discretion in issuing that limitation.

       Nor did the District Court abuse its discretion when it
limited recoverable preparation time to one attorney and up to
a maximum of 1.75 preparation hours per hour of documented
deposition time. The record reflects that Relator seeks to
recover an unreasonable amount of deposition fees, including,
among other things: (1) $37,609 for deposing two individuals
over five hours; (2) $64,412 for deposing a Rule 30(b)(6)
witness for seven hours; (3) $26,927 for deposing two other
individuals for 6.2 hours; and (4) $169,120 for seven more
depositions. In total, Relator claims nearly $300,000 in fees to
prepare for and conduct twelve depositions that averaged about
5.25 hours each. Relator, who has the burden to show that the
fees are reasonable, does not provide an argument on appeal to
substantiate those exorbitant costs, nor did it to the District
Court. The Court explained that it had given the parties “prior
express guidance on the issue of claiming fees for time devoted
to depositions” throughout the litigation. App. 17; see also
Bell, 884 F.2d at 721
(noting that judges may rely upon their
experience with a case when assessing the reasonableness of a
fee request). The Court credited C&D’s challenges, and it
noted that “Relator … failed to demonstrate why any greater
amount of preparation time should be allowed.” App. 18.
Thus, it did not abuse its discretion when it limited Relator’s
request for deposition fees.




                               22
       C. Summary Judgment, Reconsideration, and Daubert
       Motion Fees

        As a threshold matter, Relator contends that C&D did
not meet its burden to notify him of its challenges to the fees
relating to the summary judgment, reconsideration, and
Daubert motions. According to him, C&D made a fatal
mistake by not submitting affidavits challenging those fees.
However, he relies on Bell, which provides that an objecting
party need only submit an affidavit “to the extent the challenger
seeks to raise a factual issue—for example, a claim that the fee
applicant’s billing rate was lower than claimed[.]” Appellant
Br. at 19 (quoting 
Bell, 884 F.2d at 720
).

       C&D does not challenge any of the underlying facts
supporting Relator’s claim for legal fees, i.e., the billing rates
and number of hours worked. Rather, C&D contends that said
rates and hours worked were not reasonable. In such instances,
Bell makes clear that “parties need not submit counter-
affidavits challenging the fee request, so long as they submit
briefs that identify the portion of the fee request being
challenged and state the grounds for the challenge with
sufficient specificity to give the fee applicants notice that they
must defend the contested portion of their fee 
petition.” 884 F.2d at 715
. C&D clearly meets this standard because its brief
and exhibits before the District Court specifically challenge,
inter alia, each of Relator’s requested fees, thereby putting
Relator on notice that his fee request was excessive.

       Rather, as with the challenges to the deposition fees, we
must assess whether the District Court “provide[d] a concise
but clear explanation of its reasons for the fee award” in order




                               23
to apply the abuse of discretion standard. 
Id. at 722-23
(quoting 
Hensley, 461 U.S. at 437
). The question on appeal
therefore is whether the Court properly analyzed the
circumstances of the case and then properly explained its
reasoning with respect to the fees associated with the summary
judgment, reconsideration, and Daubert motions.

       The District Court permitted sixty percent of Relator’s
claim for the written work recorded for Relator’s summary
judgment motion, fifty percent of the time charged for
opposing C&D’s summary judgment motion, and thirty
percent of the time recorded for the Relator’s reply brief.13 It
did so on the basis that: (1) “the number of hours attributed to
the Relator’s own motion (284.15) comes within a day’s worth
of the number of hours counsel then charged for defending
against the C&D opposing motion (291.20)”; (2) expert
attorneys “in the specific legal fields at issue in this case would
[not] need to log so many hours on supposedly familiar issues”;
(3) “one would reasonably expect that at least a good portion
of the work undertaken to plow the legal field for advancing a
summary judgment motion would be (or at least should be)
useful and usable for defending an opposing motion (or vice
versa)”; and (4) the Court had significant knowledge of the
case “gleaned from managing the case from start to finish[.]”
App. 19-20. The Court’s reasoning was therefore more than
adequate and far from being the product of an abuse of

13
  Relator’s attorneys billed more than 900 hours for summary
judgment proceedings, including: 284.15 hours to draft and file
Relator’s motion for summary judgment; 291.20 hours to draft
and file an opposition to C&D’s motion for summary
judgment; and 127 hours to draft and file a reply brief in
support of his motion for summary judgment.



                                24
discretion.

        Regarding the motion for reconsideration, Relator’s
attorneys billed approximately seventy-eight hours to respond
to C&D’s motion. App. 21. The District Court adopted C&D’s
recommendation and reduced it to twenty-five hours,
explaining that: (1) motions for reconsideration are themselves
rarely successful and are granted only under very narrow
circumstances, making it relatively easy to respond to them;
and (2) C&D’s motion for reconsideration was only five pages
– accordingly, it could not possibly have reasonably taken
seventy-eight hours to prepare a response. 
Id. This explanation
is sufficient to warrant the reduction and meet the
“concise but clear” standard. As with its determination with
the summary judgment fees, the Court’s decision could not
possibly be categorized as being the product of an abuse of
discretion. See Rite Aid 
Corp., 396 F.3d at 299
.
        With respect to the fees related to the Daubert motions,
the District Court adopted C&D’s proposal to reduce these fees
by $58,106.56, stating that “[t]he Relator’s counsel has not
persuaded the Court that C&D’s challenges to the fees
attributed to the Daubert activities are not valid.”14 App. 21.
In other words, the Court explained that C&D met its burden
by adequately challenging Relator’s excessive fee request as it
relates to the Daubert motions, and Relator failed to defend the
reasonableness of his request in light of C&D’s challenge.
That makes sense given that Relator’s only response to C&D’s

14
  Relator’s attorneys billed more than 200 hours and $85,000
for briefs regarding Daubert motions: 100 hours to file its lone
Daubert motion, and 103 hours to draft and file oppositions to
C&D’s two Daubert motions.




                              25
challenge was that the parties had to speculate about the
relationship between C&D’s proposed hours and the real world
of work actually done on the case, and that C&D’s challenges
did not give Relator sufficient notice to rebut the claimed
reductions. Therefore, the District Court’s reduction of
Relator’s fee request for Daubert activities was not an abuse of
discretion.15

           D. Fees on Fees

        Finally, Relator argues that he is owed the fees incurred
in litigating this fee petition before the District Court and this
Court. See Prandini v. Nat’l Tea Co., 
585 F.2d 47
, 53 (3d Cir.
1978) (“[T]he time expended by attorneys in obtaining a
reasonable fee is justifiably included in the attorneys’ fee
application, and in the court’s fee award.”). Relator raised this
issue before the District Court, and there is precedent for “fees
on fees” under Prandini. However, the Court did not rule on
the reasonableness of these fees, including the extent to which
the level of Relator’s attorneys’ success (or lack thereof)
affects the award. We decline to address this “fees on fees”
issue in the first instance on appeal. Rather, the District Court
shall do so on remand due to its familiarity with the case and
the fact that it has been “managing the case from start to
finish[.]” App. 20; see 
Hensley, 461 U.S. at 437
, 103 S.Ct. at
1941 (“We reemphasize that the district court has discretion in
determining the amount of a fee award. This is appropriate in
view of the district court’s superior understanding of the
litigation and the desirability of avoiding frequent appellate

15
   As with the deposition fees, we agree with the District Court
that a reduction of the excessive Daubert motion related fees
is in order.



                               26
review of what essentially are factual matters.”); Citizens
Council of Del. Cty. v. Brinegar, 
741 F.2d 584
, 594 (3d Cir.
1984) (“The determination of whether attorneys’ fees are
reasonable is for the district court . . . .”); 
Ursic, 719 F.2d at 675
(“Absent error of law, determination of the reasonableness
of the fee is for the district court—both in the original instance
and on remand from this court.”).

        The District Court should proceed in two steps: (1) as
with all fee petitions, it must first determine whether the fees
on fees are reasonable; and (2) once the reasonability analysis
is complete, the Court must consider the success of the original
fee petition and determine whether the fees on fees should be
reduced based on the results obtained. See 
Maldonado, 256 F.3d at 188
(applying the limited success fee reduction
rationale to the court’s consideration of fees generated in the
litigation of a fee petition). Notably, the reduction analysis for
the fees generated from litigating the fee petition is
independent from the reduction analysis applied to the
underlying litigation. See Institutionalized Juveniles v. Sec’y
of Pub. Welfare, 
758 F.2d 897
, 924 (3d Cir. 1985) (“[T]he fee
reduction rationale of Hensley, because it is intended to ensure
the award of a reasonable fee in light of the results obtained,
applies by force of the Court’s reasoning to fees generated in
the litigation of a fee petition, and compels us to treat the fee
petition litigation as a separate entity subject to lodestar and
Hensley reduction analysis.”).


                      III. CONCLUSION

       We will not close this opinion without mentioning that
although we vacate and remand the case to the District Court




                               27
with respect to the “fee on fees” issue we recognize and
commend the District Court for its admirable handling of this
case which by any standard was quite difficult. For the
aforementioned reasons, we will vacate and remand for the
District Court to decide whether the “fees on fees” that Relator
seeks to collect are reasonable and whether they should be
reduced based on the results obtained. We otherwise will
affirm the Court’s orders in all other respects.




                              28

Source:  CourtListener

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