Justice Guzman delivered the opinion of the Court, in which Chief Justice Hecht, Justice Green, Justice Willett, Justice Devine, and Justice Brown joined.
The discovery dispute in this mandamus proceeding arises in the context of multidistrict litigation involving allegations of underpaid homeowner insurance claims. The issue is whether a party's attorney-billing information is discoverable when the party challenges an opposing party's attorney-fee request as unreasonable or unnecessary but neither uses its own attorney fees as a comparator nor seeks to recover any portion of its own attorney fees. We hold that, under such circumstances, (1) compelling en masse production of a party's billing records invades the attorney work-product privilege; (2) the privilege is not waived merely because the
To the extent factual information about hourly rates and aggregate attorney fees is not privileged, that information is generally irrelevant and nondiscoverable because it does not establish or tend to establish the reasonableness or necessity of the attorney fees an opposing party has incurred.
Following two hail storms that struck Hidalgo County in 2012, insured homeowners sued various insurers and claims adjustors, alleging underpayment of insured property-damage claims. The lawsuits were consolidated into a single multidistrict litigation (MDL) court for pretrial proceedings, including discovery.
The discovery dispute in this mandamus proceeding involves four MDL cases in which individual homeowners sued National Lloyds Insurance Co., Wardlaw Claims Service, Inc., and Ideal Adjusting, Inc. (collectively, the insurer),
A mere two months before trial, and nearly a year after the parties served MDL master discovery requests, the homeowners requested a trial continuance and sought leave to serve additional discovery regarding the insurer's attorney-billing information. Though the insurer is not making a claim for attorney fees,
According to the homeowners, the insurer's attorney fees and billing information are discoverable in the present cases because the insurer's counsel, Scot Doyen, testified as an attorney-fee expert in Amaro and admitted on cross-examination — albeit over objection — that an opposing party's fees could be considered as "a factor" in determining a reasonable fee recovery. Doyen also used his law firm's billing practices as an example of a proper way to allocate attorney fees to avoid an artificially inflated fee claim in MDL cases.
Based on the record in Amaro, the homeowners contend Doyen's expert testimony in these cases will necessarily be based on his experience as the insurer's attorney in the same proceedings and, more to the point, he has admitted that an opposing party's fees are relevant to the disputed attorney-fee issues. Accordingly, the homeowners argue that information about the insurer's attorney-fee expenditures is discoverable and relevant to the attorney-fee dispute.
The insurer objects on the basis that the requested discovery is overly broad and seeks information that is both irrelevant and protected by the attorney-client and work-product privileges. With regard to relevancy, the insurer principally relies on its stipulation that it "will not use its own billing invoices received from its attorneys; payment logs, ledgers, or payment summaries showing payments to its attorneys; or the hourly fees or flat rates being paid to its attorneys; audits of the billing and invoices of its attorneys to contest the reasonableness of [the homeowners'] attorney's fees."
After two non-evidentiary hearings, a discovery special master recommended that (1) an opponent's attorney-billing information is, as a general proposition, relevant to the reasonableness of an attorney-fee request in the same case; (2) to the extent the discovery requests in this case seek material from an expert witness on the attorney-fee issue, the information falls within the scope of permissible discovery under Texas Rule of Civil Procedure 192.3(e); (3) some of the discovery requests should be more narrowly tailored, but the insurer's objections to the discovery requests as modified should be overruled; and (4) "[s]pecific records may be redacted for content protected by an appropriate privilege." Adopting these recommendations, the MDL pretrial court ordered the insurer to respond to the discovery requests.
The court of appeals denied the insurer's petition for mandamus relief.
In this original proceeding, the insurer primarily relies on several lower-court cases declaring information about a party's attorney-fee expenditures is "patently irrelevant" to an opposing party's attorney-fee claim.
Relying on authority from other jurisdictions, the homeowners argue trial courts have discretion to order disclosure of an opposing party's attorney-fee information and could permissibly compel production in this case. In addition to citing counsel's role as a testifying expert in this case and Amaro as supporting the trial court's discovery order, the homeowners rely on the concurring opinion in El Apple I, Ltd. v. Olivas,
Germania Farm Mutual Insurance Association filed an amicus brief supporting the insurer. Germania is a defendant in other cases pending before the MDL pretrial court and asserts the plaintiffs in those cases are seeking nearly identical discovery from Germania even though "Germania's counsel has not testified about attorney's fees in any MDL case or otherwise done anything to put Germania's attorney's fees at issue."
A trial court generally has discretion to determine the scope of discovery.
The insurer asserted two privileges in response to the discovery requests: the attorney-client privilege and attorney work-product privilege. Analogizing to our analysis in National Union Fire Insurance Co. v. Valdez,
The attorney-client privilege protects communications between attorney and client that are (1) not intended to be disclosed to third parties and (2) made for the purpose of facilitating the rendition of professional legal services.
"The work product privilege is broader than the attorney-client privilege."
Certain matters are expressly excluded from the definition of "work product," however, and are not protected from discovery even if made or prepared in anticipation of litigation or for trial.
"The primary purpose of the work product rule is to shelter the mental processes, conclusions, and legal theories of the attorney, providing a privileged area within which the lawyer can analyze and prepare his or her case."
The party asserting a privilege in opposition to a discovery request "must establish by testimony or affidavit a prima facie case for the privilege," although "[t]he party need produce `only the minimum quantum of evidence necessary to support a rational inference that the allegation of fact is true.'"
We have described the work-product privilege as encompassing "two related but different concepts":
Billing records constitute "communication[s] made in anticipation of litigation or for trial between a party and the party's representatives or among a party's representatives."
Conceptually, the matter is similar to the issue we considered in National Union Fire Insurance Co. v. Valdez, which involved a discovery request for an attorney's entire litigation file.
A request for all billing invoices, payment logs, payment ledgers, payment summaries, documents showing flat rates, and audits is analogous to the request in Valdez for an attorney's entire litigation file. These billing records — which are generated in anticipation of litigation and trial — are "almost certain to encompass numerous irrelevant and immaterial documents."
For example, billing records reveal when and where attorneys strategically deploy a client's resources; which issues were addressed by experienced lawyers as compared to less experienced counsel; the subject-matter expertise of an attorney working on a particular aspect of the case; and who was hired as consultants — including consulting experts and jury consultants — and when. This information provides detailed information regarding a party's litigation decisions and also illuminates the relative significance of or concern about particular matters. Especially when a party is a repeat litigant, as the insurer is here, decisions revealed through billing records represent strategic choices and are pieces of "an overall legal strategy for all the cases in which it is involved," which a party must be allowed to develop without intrusion.
The homeowners argue that redaction of privileged material, which the trial court allowed in this case, should be sufficient to protect any privileged information. However, in Valdez, we held the attorney's entire litigation file is privileged per se, regardless of whether unprivileged information is included in the file.
We also conclude that redacting privileged information — such as the specific topics researched or the descriptions of the subject of phone calls — would be insufficient as a matter of law to mask the attorney's thought processes and strategies. The chronological nature of billing records reveals when, how, and what resources were deployed. With this knowledge, a party in the same proceeding could deduce litigation strategy as to specific or global matters.
Aggregate fee summaries also reveal strategic choices. When litigation is pending, the discovery rules impose a duty to amend or supplement discovery throughout litigation.
Further, objections and disputes regarding what should be redacted based on privilege would lead to collateral litigation over attorney-fee claims, with the issues likely to recur throughout the litigation as discovery is amended or supplemented. As the United States Supreme Court admonished in Hensley v. Eckerhart, "[a] request for attorney's fees should not result in a second major litigation."
We therefore hold that requests for production of all billing invoices, payment logs, payment ledgers, payment summaries, documents showing flat rates, and audits invade the zone of work-product protection. Our holding does not prevent a more narrowly tailored request for information relevant to an issue in a pending case that does not invade the attorney's strategic decisions or thought processes.
In describing billing records as work product when requested en masse, we do not foreclose the possibility that some or all of the information may also be protected from compelled disclosure by the attorney-client privilege.
Although we conclude the requested documents are protected by the work-product privilege, factual information is not exempt from discovery by mere inclusion within protected documents.
We hold the requested information is generally not relevant because (1) the opposing party may freely choose to spend more or less time or money than would be "reasonable" in comparison to the requesting party; (2) comparisons between the hourly rates and fee expenditures of opposing parties are inapt, as differing motivations of plaintiffs and defendants impact the time and labor spent, hourly rate charged, and skill required; (3) "the tasks and roles of counsel on opposite sides of a case vary fundamentally," so even in the same case, the legal services rendered to opposing parties are not fairly characterized as "similar";
The scope of discovery extends to any unprivileged information that is "relevant to the subject matter" of the pending action, even if inadmissible at trial, so long as the information sought "appears reasonably calculated to lead to the discovery of admissible evidence."
The discovery guideposts can be summarized as follows: only relevant evidence is discoverable; relevant evidence that is privileged is not discoverable; relevant evidence that is not privileged is discoverable when (i) it is admissible or (ii) it is inadmissible but reasonably calculated to lead to the discovery of admissible evidence; and failing either of those admissibility criteria, the request for discovery may be denied even if the requested information is relevant and unprivileged.
We turn now to the pertinent inquiry: whether information about opposing counsel's hourly rates, total fees, and total reimbursable expenses is relevant and reasonably calculated to lead to the discovery of admissible evidence even when those expenditures are not independently at issue in the litigation, as is the case here.
We begin by considering the issue to which the requested information is purportedly relevant — the homeowners' claim for reimbursement of reasonable and necessary attorney fees.
"Texas follows the American rule on attorney's fees, which provides that, generally, `a party may not recover attorney's fees unless authorized by statute or contract.'"
The homeowners cite the first and third Arthur Andersen factors as establishing the trial court's discretion to authorize discovery concerning the insurer's attorney-fee expenditures. The homeowners neither address the other enumerated factors nor identify any nonenumerated factor affecting the analysis in this case. But relying on the concurring opinion in El Apple I, Ltd. v. Olivas, the homeowners assert that a comparison of their own fees to the insurer's fees is relevant to discharging their burden of proof and is, in fact, a "surer indicator[]" of a reasonable fee.
The insurer argues no Arthur Andersen factor is textually or practically directed to an opposing party's attorney fees because the fee-recovery analysis focuses solely on the reasonableness and necessity of the claimant's attorney fees. The insurer characterizes the El Apple concurrence as involving a party's election to use its own fees as a comparator and not as insinuating an opposing party's attorney-billing information is inherently relevant.
Considering where the evidentiary burden lies with respect to a fee-shifting
Despite superficial appeal, such "an apples-to-oranges comparison" is analytically faulty:
In order for an opposing party's fees to serve as a relevant measure to any legitimate degree, the claimant would first have to establish those fees are themselves reasonable and necessary. Doing so necessitates consideration of other data points beyond the instant parties' expenditures. Because other evidence would be required to make an opposing party's fees relevant in the first instance, discovery concerning an opposing party's attorney-fee expenditures serves no purpose besides unnecessarily complicating the litigation in pursuit of a collateral matter. Evidence of an opposing party's fees lacks genuine probative value as a comparator for a requesting party's fees and, at best, would be merely cumulative or duplicative of other evidence directed to that inquiry.
This conclusion accords with both a literal and practical reading of the first and third Arthur Andersen factors, which the homeowners cite as supporting the trial court's discovery order. With regard to the first factor — which considers the time, labor, and skill required and the novelty and difficulty of the questions involved — there can be little dispute that different motivations and different demands drive the time and labor spent, hourly rate charged, and skill required to defend litigation as compared to prosecuting a suit.
For example, a party subject to repeat litigation, such as an insurer or corporate defendant, may view the precedential value of a case more significantly than an opposing party who might not anticipate ever being involved in similar litigation again. Likewise, one side may have more at risk in a case.
Similarly, the nature of the attorney-client relationship may differ in ways that affect the rates charged and the demands on counsel's time. In that vein, ongoing attorney-client relationships often exist between corporate and governmental parties and their counsel and frequently involve negotiated rates that take into consideration future litigation work.
Even when working on the same tasks, attorneys litigating the same case do not approach those tasks in a sufficiently comparable manner to be genuinely probative of the degree of effort or skill required by one another. Indeed, while counsel for both sides may attend the same deposition, the attorney taking the deposition would reasonably be expected to expend more time and expense in preparing for the deposition than the attorney defending the deponent. In like manner, the contrast between responding to discovery requests and reviewing and analyzing information produced creates significant variations in time and money spent. Suffice it to say that counsel in the same case are not actually or even effectively performing "similar legal services" for the litigation.
Explaining the distinction, one court observed: "The particular rates charged by defendants' attorneys in this action reflect only the rates charged in one specific case by one specific law firm but do not have a bearing on the general hourly rate normally charged for similar legal work in the area."
The fact that the insurer challenges the homeowners' attorney fees as excessive does not, in and of itself, alter the analysis.
The homeowners cite several state and federal decisions for the proposition that an opposing party's attorney-billing information is at least minimally relevant and therefore the trial court has complete discretion to order discovery of such information or not.
What's more, barring unusual circumstances, evidence about an opposing party's attorney fees is not necessary for the requesting party to meet its burden of proof, but there is a genuine threat that allowing such discovery would give rise to abusive discovery practices. "Discovery is often the most significant cost of litigation" and a potential "weapon capable of imposing large and unjustifiable costs on one's adversary."
In sum, barring unusual circumstances, an opposing party's attorney-fee information is not relevant because there is no reasonable expectation that the information will aid the dispute's resolution. Moreover, whatever marginal relevance might theoretically exist would not come close to surpassing competing concerns about undue prejudice, confusion of the issues, and abusive discovery practices, among others. Aside from lacking genuine probative value, discovery of an opposing party's attorney-billing information should generally not be permitted for these additional reasons.
Attorney-billing information may be discoverable by virtue of the opposing party designating its counsel as a testifying expert. Per Rule 192.3, a party is entitled to expert discovery of facts known by the testifying expert relating to the expert's mental impressions and opinions formed, any bias of the expert witness, and documents provided to or reviewed by the
In those circumstances, however, the requesting party must follow the discovery rules applicable to testifying experts. Importantly, a party is limited in the tools available to discover information concerning expert witnesses, even though the information may otherwise be within the scope of testifying-expert discovery. "Rule 192.3(e) sets forth the scope of information that parties may discover about a testifying expert.... Rule 195 addresses the methods for obtaining such information, limiting testifying-expert discovery to that acquired through disclosures, expert reports, and oral depositions of expert witnesses."
While the distinctions may seem like a technicality, the limitations on expert discovery ensure discovery is narrowly tailored to permissible purposes. In this case,
Because the homeowners chose not to use Rule 195's permissible discovery methods to request insurer's expert information, the trial court erred insofar as it relied on Rule 192.3(e) in determining the scope of discovery. Additionally, the Rule 192.5(c)(1) work-product exception does not apply to requested information under these particular discovery methods and thus the trial court's discovery order improperly compels discovery of work-product privileged information.
"The line between who is a Rule 702 expert witness and who is a Rule 701 [fact] witness is not always bright."
The dissent's analysis conflates the role of an expert with the role of a fact witness and ignores the distinction between the discovery rules associated with those respective roles. We do not disagree with the dissent that the insurer's counsel can be cross-examined at trial in his role as an expert witness; consequently, discovery as to his credibility, biases, and facts relating to or forming the basis of his mental impressions and opinions is permitted under the expert-discovery rules.
Finally, the dissent's preservation argument misses the mark.
Making a claim for attorney fees or using attorney fees as a comparator in challenging an opponent's fee request puts a party's attorney fees at issue in the litigation. In addition, designating counsel as an expert opens the door to expert-witness discovery as provided and limited by the Texas Rules of Civil Procedure. Outside of these scenarios and absent unusual circumstances, information about an opposing party's attorney fees and expenses is, in the ordinary case, privileged or irrelevant and, thus, not discoverable. Given the circumstances in this case and the nature of the discovery requests at issue, we conditionally grant mandamus relief and direct the trial court to vacate its order compelling National Lloyds Insurance Company, Wardlaw Claims Service, and Ideal Adjusting to answer requests for production 1, 2, 4, and 5, and interrogatories 1, 2, and 3. The writ will issue only if the trial court fails to do so.
Justice Johnson filed a dissenting opinion, in which Justice Lehrmann and Justice Boyd joined.
Phil Johnson Justice, Dissenting
Relators (collectively, National Lloyds or the company) designated Scot Doyen, an attorney representing them in these lawsuits, to testify regarding attorney's fees the homeowner-plaintiffs seek to recover. The question posed by the parties and ruled on by the trial court is whether information about his fees, expenses, and billing information, as well as that of other attorneys representing National Lloyds in the suits is discoverable. National Lloyds maintained in the trial court and now
This Court, addressing an issue not raised by the parties, says the homeowners used improper discovery methods by using interrogatories and requests for production of documents. It follows that up by saying that the methods would not have mattered anyway because the information is not relevant. The first reason the information is irrelevant, says the Court, is because National Lloyds has disavowed any intent to use its attorney's fees as a measure for challenging the plaintiffs' claims. The second reason is because whatever relevance the information might have is slight when compared to competing concerns such as undue prejudice, confusion of the issues, and abusive discovery practices. Thus, the Court agrees with National Lloyds and determines that the trial court abused its discretion by directing even the limited discovery it ordered.
I disagree and would deny relief.
Generally, parties may obtain discovery "regarding any matter that is not privileged and is relevant to the subject matter of the pending action, whether it relates to the claim or defense of the party seeking discovery or the claim or defense of any other party." TEX. R. CIV. P. 192.3(a); Ford Motor Co. v. Castillo, 279 S.W.3d 656, 664 (Tex. 2009). Trial courts are afforded broad discretion in determining and controlling the scope of discovery. See In re Am. Optical Corp., 988 S.W.2d 711, 713 (Tex. 1998). Trial court rulings regarding discovery are reviewed for abuse of discretion. In re Nat'l Lloyds Ins. Co., 449 S.W.3d 486, 488 (Tex. 2014). There is no presumption that documents are privileged, and the party resisting the discovery bears the burden of pleading and proving an applicable privilege. In re E.I. DuPont de Nemours & Co., 136 S.W.3d 218, 223, 225 (Tex. 2004). Denial of discovery is proper only if there is "no possible relevant, discoverable" material to support, or lead to evidence that would support, claims or defenses of a party. Ford Motor Co., 279 S.W.3d at 664.
National Lloyds designated Doyen, whose firm is one of those representing it in the pending cases, as an expert witness on attorney's fees. After Doyen testified in a similar-type case and gave opinion testimony as to the plaintiff's attorney's fee request, based in part on his personal knowledge from representing a defendant in the case, the homeowners sought permission to serve interrogatories and requests for production regarding, as to each case, the time Doyen and his firm spent on the case and the firm's fees and expenses billed to and paid by National Lloyds. They sought the same information regarding all the lawyers representing National Lloyds in the cases. National Lloyds objected that the requested discovery was "overly broad and seeks information that is both irrelevant and protected by the attorney-client and work-product privileges." Ante at 801. A special master heard the dispute. National Lloyds neither offered testimony nor produced any documents for examination by the special master or trial court. The special master recommended, and the trial court ordered,
National Lloyds did not assert in the trial court that the homeowners improperly requested discovery by using interrogatories and requests for production. It did not assert in the court of appeals that the trial court abused its discretion by authorizing discovery by means of interrogatories and requests for production instead of requests for disclosure, depositions, and reports as permitted by Rule 195. See TEX. R. CIV. P. 195 (entitled "Discovery Regarding Testifying Expert Witnesses"). Nor has it made that argument here. The issue of whether the homeowners used proper discovery methods when National Lloyds did not make that challenge is not an issue the trial court had a duty to raise and rule on sua sponte. Compare, e.g., Rusk State Hosp. v. Black, 392 S.W.3d 88, 103 (Tex. 2012) ("Subject matter jurisdiction cannot be waived or conferred by agreement, can be raised at any time, and must be considered by a court sua sponte."). We do not have a duty to sua sponte raise the issue, either. Id. To the contrary, under this record we should do as the trial court did and limit ourselves to ruling on the issues presented by the parties.
In my view, the trial court did not abuse its discretion by addressing only the issues presented by the parties and not granting relief on grounds National Lloyds did not urge. See McKinney v. Nat'l Union Fire Ins. Co., 772 S.W.2d 72, 75 (Tex. 1989) ("[T]he objecting party must assume the burden of establishing its privilege, immunity or other objection to the discovery request." (emphasis added)). Moreover, interrogatories and requests for production of documents are appropriate for discovering information related to Doyen as a person with knowledge of relevant facts regarding attorney's fees in cases in which he has participated in trial preparation, as is discussed more fully below. National Lloyds should not get to convert a witness from one with knowledge of relevant facts into solely an expert witness simply by designating the witness as an expert. And the trial court would not have abused its discretion by considering Doyen as a fact witness as well as an expert for discovery purposes — even if National Lloyds had argued he was not a fact witness, which it has not.
In light of the foregoing, I disagree with the Court's conclusion that "[b]ecause the homeowners chose not to use Rule 195's permissible discovery methods to request insurer's expert information, the trial court erred insofar as it relied on Rule 192.3(e) in determining the scope of discovery." See ante at 815.
Going beyond the issue of methods of discovery, the Court concludes that the trial court abused its discretion by ordering National Lloyds to respond to the following discovery requests because they did not seek relevant information:
Interrogatories:
Requests for Production:
(emphasis added). The record clarifies that Request for Production number five is limited to documents in the particular case in which discovery is sought.
The amount of reasonable and necessary attorneys' fees to which the plaintiffs are entitled, if any, will be answered by the factfinder — in these cases, presumably a jury, as jury demands have been made. Transcontinental Ins. Co. v. Crump, 330 S.W.3d 211, 230 (Tex. 2010) ("In general, the reasonableness of statutory attorney's fees is a jury question." (quoting City of Garland v. Dall. Morning News, 22 S.W.3d 351, 367 (Tex. 2000))). The discovery was sought only after Doyen had both been designated to testify in these cases and had testified in another case in opposition to a plaintiff's attorney's fee request. And there can be no doubt that if Doyen testifies, his testimony will be in opposition to the fees requested by the homeowners: trial lawyers do not call witnesses to testify in support of the opposing party's position.
During the discovery hearing the homeowners' attorneys explained that Doyen's testimony in the prior, similar-type case prompted the discovery requests here. In that case he gave opinion testimony based in part on personal knowledge from his own participation in the case. The homeowners' desire for information is understandable, given that when Doyen was cross-examined in the earlier case about the amount of time and fees he and his firm billed for handling the case, he could not recall details of those matters. Given that previous experience, the homeowners' lawyers reacted rationally: they sought specific information and records with which to arm themselves to test Doyen's testimony and opinions should his recollection again falter, or his memory as to the firm billings be incomplete. Moreover, just in case there were other firms involved in representing National Lloyds in any of these matters, the plaintiffs' discovery requests inquired about those firms, also. For if litigation tasks in a case are split among several firms, a true picture of the amount of time spent and fees billed by attorneys representing National Lloyds can only be presented by disclosure of the time and billings on the case from all the firms performing services.
When a witness testifies based on personal knowledge, even in part, matters within that witness's personal knowledge, subject to other exclusionary rules of evidence, become relevant and fall within the scope of cross examination. TEX. R. EVID. 602, 611(b); see also Reid Rd. Mun.
The Court says that
Ante at 798-99 (citing TEX. R. CIV. P. 192.5(b)). But the quoted language does not apply. Here, the trial court did not order National Lloyds to produce its billing records en masse, nor does anyone assert that a privilege has been waived by the company's challenging the plaintiffs' attorney's fees request. To the contrary, the special master recommended, and the trial court specifically ordered, that privileged information did not have to be disclosed — National Lloyds was to redact such information before producing its records. Further, no one claims the information is ordinarily discoverable. But it is no ordinary situation for a party's trial attorney to be designated as a testifying expert to dispute the opposing party's attorney's fee request — at least, it has not been. Things may well change after this case issues.
Following its determination that some of the requested information is protected by the work-product privilege, a determination with which I do not disagree, the Court turns to whether the requests for hourly rates, total amounts billed, and total reimbursable expenses seek discoverable information. The Court notes that this question relates to the scope of discovery and that the proper scope "extends to any unprivileged information that is `relevant to the subject matter' of the pending action, even if inadmissible at trial, so long as the information sought `appears reasonably calculated to lead to the discovery of admissible evidence.'" Ante at 808 (quoting
Ante at 799 (citing TEX. R. EVID. 401; TEX. R. CIV. P. 192.3). I disagree. First of all, the information clearly tends to establish the reasonableness and necessity of attorney's fees National Lloyds has incurred in each case. And the information sought, at a minimum, might be relevant to both the reasonableness and necessity of the plaintiffs' attorney's fees in each case to which the defendant's fees apply.
While there are certainly times when counsel's experience, the roles undertaken by counsel, and varying motivations make a direct comparison of time spent on a case and fees charged for it inapt, there are just as certainly times when circumstances in particular cases might make a comparison highly appropriate. See El Apple I, Ltd. v. Olivas, 370 S.W.3d 757, 766 (Tex. 2012) (Hecht, J., concurring). When a party designates the attorney representing it in a case to testify and dispute another party's fee request, the designation implies that the attorney will rely on his own experience in trying and billing cases comparable to the one in which he is designated to testify. If the attorney testifies and mitigating factors make a fee comparison between the parties inapplicable, then objections can be lodged based on the status of the evidence at the time the attorney testifies. See TEX. R. EVID. 611(b) (providing that "[a] witness may be cross-examined on any relevant matter, including credibility."); TEX. R. EVID. 601 (defining "relevant evidence" as evidence having any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable). In any event, the attorney will have an opportunity to address the subject and make any necessary clarifications during re-direct examination. And what better exemplar could there be of comparing apples to apples than comparing attorney activities in the very case in which the fees are sought? See El Apple I, 370 S.W.3d at 766. The trial court apparently decided that this might be such a case. In my view the trial court did not abuse its discretion by that decision and by allowing the limited discovery it ordered.
Further, the trial court could have, in its discretion, considered the information sought as being relevant for cross examination of lawyer Doyen regarding the credibility of his opinions and testimony. Witness credibility is important regarding contested issues, and attorney's fees are no different. See Howsley & Jacobs v. Kendall, 376 S.W.2d 562, 565 (Tex. 1964). The Texas Rules of Evidence expressly recognize that witnesses may be cross examined on their credibility. TEX. R. EVID. 611(b). Thus, information used to impeach the credibility of a witness, even an attorney testifying about another party's fees, is relevant, as the plaintiffs argued to the special master:
The Court gives several reasons for concluding that the requested information is not relevant. First, it says that an opposing party may freely choose to spend more or less than would be "reasonable" in comparison to the requesting party. Ante at 808. But deciding what is a reasonable fee
Second, the Court says that comparisons between attorney's fees of plaintiffs and defendants are inapt because differing motivations of the parties impact the time spent, rate charged, and skill required. Ante at 808. That may be true to some extent, but the fact remains that all the lawyers are representing clients in the same lawsuit and doing much of the same work, such as filing pleadings, attending the same depositions and hearings, doing pretrial orders and briefing, preparing to examine and cross examine the same pool of witnesses, working on the same jury charge, and preparing to argue the same case to the same jury. There is necessarily symmetry in a great deal of the activity undertaken by attorneys representing clients in the same lawsuit, even though they represent opposing parties. That symmetry is relevant for cross-examination purposes if Doyen testifies regarding such activities and is critical of the homeowners' attorney's fees request as to those activities.
Third, the Court says that the tasks and roles of counsel on opposite sides of a case vary fundamentally, so even in the same case, the legal services rendered to opposing parties are not "fairly characterized" as similar. Ante at 808. I disagree. There are some differences in the typical activities undertaken by counsel for opposing parties in a lawsuit, but most of the activities are of the same general nature. And if they are not, the testifying witness will have an opportunity to explain the differences. In any particular case the issues generally become apparent early on. From that point, preparation for the parties generally entails similar types of activities — even though likely not exactly the same activities — as set out above, and others such as researching points of law that might arise, conferring with and corresponding with the client regularly, interviewing witnesses, attending mediation, and preparing witnesses for trial. Any differences go to the weight of the evidence, not to whether there is some relevancy between the level and types of activities and time spent by the attorneys for each side. At the least, there is enough similarity and relevance for the trial court to have determined that the limited discovery it ordered was warranted.
Finally, the Court says that a single law firm's fees and rates do not determine the "customary" range of fees in a general locality for similar services. See Arthur Andersen & Co., 945 S.W.2d at 818 (noting that the fee customarily charged in the locality is a factor to be considered in determining the reasonableness and necessity of attorney's fees). True. But saying that a single firm's fees and rates do not determine a customary or reasonable fee is not the same as saying that firm's fees and rates are not relevant to the question. To the extent that "customary" fees are in issue, an opposing party's fees and rates are certainly someievidence of the customary fees and rates in that locality. As such,
In sum, it is one thing to say that evidence of National Lloyds' attorneys' time and fees in a particular case is inadmissible in that case when an opposing party is seeking attorney's fees in the case. Admissibility will depend on the evidence and what has transpired at trial before such evidence is offered, and the purpose for which it is offered. Cf. In re E.N.C., 384 S.W.3d 796, 805 (Tex. 2012); see also TEX. R. EVID. 401 (requiring that the evidence be of a "fact ... of consequence in determining the action"). But it is quite another thing to say that the trial court abused its discretion by determining evidence of the time and fees of National Lloyds' attorneys is discoverable to the limited extent it ordered here.
The Court asserts that production of any part of an attorney's file, even redacted billing information, would conflict with our holding in National Union Fire Insurance Co. v. Valdez, in which we decided that requests for en masse production of an attorney's entire litigation file was improper because it called for disclosure of privileged, work-product materials. Ante at 816 (citing Nat'l Union Fire Ins. Co. v. Valdez, 863 S.W.2d 458, 460 (Tex. 1993)). Not so. The requests for discovery in this case are not even close to the requests we considered in Valdez. An attorney's entire file includes notes about attorney-client conferences, reports to clients, trial strategies and preparation, and case evaluation; just to mention a few areas and matters that are undisputedly privileged. No one doubts that those materials "necessarily [reveal] the attorney's thought processes concerning the prosecution or defense of the case." See Valdez, 863 S.W.2d at 460.
The requested billing information in this case is a narrow sliver of the entire file, and in Valdez we were careful to note that the decision "does not prevent a party from requesting specific documents ... relevant to issues in a pending case, even though some or all of the documents may be contained in an attorney's file." Id. The information and documents sought here are limited, specific, and unquestionably relevant to an issue in this case. The trial court's authorizing National Lloyds — by a very general and nonspecific order — to redact privileged information before producing documents, was fully adequate to protect privileged information absent National Lloyds demonstrating otherwise.
To the extent the Court implies that the homeowners seek to use the requested discovery to independently support their claim for attorney's fees, National Lloyds does not claim that they do. As the homeowners argued to the special master, the discovery was sought only after Doyen's designation as a witness regarding the homeowners' attorney's fees claim, and after he testified in opposition to the fee request of a homeowner in a different trial. As discussed, the homeowners say they only seek the information to prepare for cross examining Doyen. So, any discussion about using the fees National Lloyds' lawyers charged as proof of the homeowners' attorney's fees is misplaced.
Moreover, the discovery requests can hardly be excessively burdensome or a great expansion of the trial that will take place. First, National Lloyds did not claim that they are. Second, it is common knowledge among civil trial lawyers that insurance companies require regular, detailed billing invoices from their attorneys. Invoices generally set out, at the very least, the date, amount of time taken, and description of activity for which the company is being billed. That information is most
As the Court explains, this situation has been brought about by National Lloyds' own litigation choice to designate its trial attorney to testify as an expert. Ante at 807 n.54 (noting that parties concerned about disclosing fees and expenses paid to trial counsel can designate another expert witness or withdraw the designation of trial counsel as a witness). What National Lloyds should not be able to do is have it both ways by using one of its trial attorneys to critique the time, fees, and other details of the homeowners' attorney's fees request, while screening from view its own attorneys' time and fees in the same case for the same or similar activities. The materials the trial court ordered discovered, at the very least, may lead to admissible evidence that many, if not most, jurors would consider relevant in weighing the testimony of a witness such as Doyen — how much time did the insurance company's lawyers spend on the case in regard to the items those lawyers criticize as to the homeowners' attorneys, and what did they and their insurance clients consider a reasonable fee for those efforts?
The trial court's reasonably cautious approach as to what interrogatories must be answered and what discovery must be produced does not demonstrate an abuse of discretion. There is, at a minimum, possible relevance of the discovery sought to an element of the pending case. See Ford Motor Co., 279 S.W.3d at 664. There simply has been no showing that National Lloyds' complying with the trial court's discovery order would result in undue prejudice or abusive discovery practices. It most certainly would not result in confusion of the issues — it is a discovery order, not a ruling on the admissibility of the information or documents sought.
I would deny mandamus relief. Because the Court does otherwise, I respectfully dissent.
As a point of clarification, Doyen later added:
Id. (citations and internal quotations omitted).