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STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
BAYFRONT MEDICAL CENTER, INC.;
CAPE MEMORIAL HOSPITAL, INC.,
d/b/a CAPE CORAL HOSPITAL; CGH
HOSPITAL, LTD., d/b/a CORAL
GABLES HOSPITAL; DELRAY MEDICAL
CENTER, INC., d/b/a DELRAY
MEDICAL CENTER; LEE MEMORIAL
HEALTH SYSTEM; ET AL.,
Petitioners,
vs.
AGENCY FOR HEALTH CARE
ADMINISTRATION,
Respondent.
_______________________________/
Case No. 12-2757RU
ORDER AWARDING FEES AND COSTS
Administrative Law Judge, John D.C. Newton, II, of the
Division of Administrative Hearings, conducted the final hearing
in this matter on April 5, 2016, in Tallahassee, Florida.
APPEARANCES
For Petitioner: Harvey W. Gurland, Esquire
Joanne Barbara Erde, Esquire
Donna Holshouser Stinson, Esquire
Duane Morris, LLP
Suite 3400
200 South Biscayne Boulevard
Miami, Florida 33131
For Respondent: Alex B.C. Ershock, Esquire
Roberts Reynolds Bedard & Tuzzio PLLC
470 Columbia Drive, Suite C101
West Palm Beach, Florida 33409
2
Karen A. Brodeen, Esquire
Office of the Attorney General
The Capitol, Plaza Level 01
Tallahassee, Florida 32399-1050
STATEMENT OF THE ISSUES
(A) What is the amount of reasonable attorney’s fees and
taxable costs Respondent, Agency for Health Care Administration
(Agency), must pay Petitioners, Bayfront Medical Center, Inc.,
et al (Hospitals), for this unpromulgated rule challenge before
the Division of Administrative Hearings (Division).
(B) What is the amount of reasonable attorney’s fees the
Agency must pay Hospitals for appellate proceedings before the
First District Court of Appeal in this matter?
PRELIMINARY STATEMENT
In this case, Bayfront Medical Center, Inc., and 17 other
hospitals collectively filed a Petition for Determination of
Invalidity of Non-Rule Policy against the Agency with the
Division. The petition asserted that the Agency practice of
declining to pay hospitals Medicaid-funded compensation for
emergency medical services provided to undocumented aliens once
the patients reached a point of “stabilization” was a rule as
defined in section 120.52(16), Florida Statutes (2012)1/. Since
the practice amounted to a rule and had not been promulgated,
the Hospitals argued, the Agency could not follow its practice
of using the “stabilization” standard. The Hospitals prevailed.
3
The Final Order in this proceeding concluded:
[T]he Agency's statements about and
application of the "stabilization" standard
meet the definition of a rule that has not
been adopted pursuant to section 120.54(1).
The Agency must immediately discontinue all
reliance upon the "stabilization" standard
or any substantially similar statement as a
basis for agency action.
The Final Order also concluded that the Hospitals were “entitled
to recover fees and costs in this action pursuant to section
120.595(4)(a).”
The Agency appealed to the First District Court of Appeal.
After oral argument the Agency dismissed its appeal. The
court’s opinion allowing the Agency to dismiss its appeal
stated:
Here, the administrative law judge (ALJ)
found that AHCA was operating under an
unpromulgated rule which was not required by
the Federal Government. AHCA has sought to
voluntarily dismiss this court’s review of
that finding. Thus, the ALJ’s finding
entitles appellees to reasonable attorney’s
fees during the entire duration of these
proceedings. As such, we accept the
voluntary dismissal, but we grant appellees’
motion for appellate attorney’s fees and
remand for a determination of the amount if
the parties are unable to reach an
agreement.
The parties did not reach agreement. After several
continuances granted at the request of the parties, the final
hearing was conducted April 5, 2016. The Hospitals presented
the testimony of Joanne B. Erde, Esquire, and expert witness
4
David Ashburn, Esquire. Hospitals’ Exhibits 1 through 7, 10 and
11 were admitted into evidence. The Agency presented the
testimony of its expert witness, M. Christopher Bryant, Esquire.
Agency’s Exhibits 4 through 6 were admitted into evidence. The
parties requested and received additional time to file proposed
final orders. The parties timely filed proposed final orders.
They have been considered in the preparation of this Order.
FINDINGS OF FACT
Proceedings Before the Division of Administrative
Hearings and the First District Court of Appeal
1. In the beginning this was an action by the Hospitals
aimed at stopping Agency efforts to recoup reimbursement of
Medicaid payments to the Hospitals for emergency services
provided to undocumented aliens once the patients have reached a
point of “stabilization.” The issue of whether the Agency could
apply the “stabilization” standard to the Hospital claims for
Medicaid payment for services provided indigent aliens recurred
in Agency claims against hospitals throughout the state to
recoup Medicaid payments. Hospitals challenged Agency claims in
individual proceedings under section 120.569, which the Agency
referred to the Division for disputed fact hearings. Duane
Morris, LLP (Duane Morris), led by Joanne Erde, represented the
hospitals in the individual proceedings.
5
2. The Hospitals collectively engaged Duane Morris to
represent them in this proceeding challenging the Agency’s
stabilization standard as an unpromulgated rule. Joanne B.
Erde, Donna Stinson, and Harry Silver were the Hospital’s
lawyers in this proceeding. Ms. Erde is an experienced lawyer
who has focused her practice in health care. Ms. Stinson is an
experienced lawyer who concentrated her practice in health care
and administrative law litigation before the Division. The
Agency does not question their expertise. Mr. Silver is an
experienced lawyer with no Florida administrative law
experience. His role in the case was minimal.
3. Depositions taken in one of the individual
reimbursement cases were significant evidence in this
proceeding. Those depositions make it clear that the Hospitals’
counsel was tuned into the unpromulgated rule issue and using
discovery in that case to gather and identify the evidence that
they would need in this case. Representation of the Hospitals
in individual reimbursement actions provided Hospitals’ counsel
the advantage of preparing with level of detail before filing
the petition.
4. The engagement letters recognize this stating: “We
have an understanding of the facts underlying this matter and
have substantial knowledge concerning the law governing the
issues in this case.” This well-developed understanding of the
6
facts should have minimized the need for discovery and
preparation in this proceeding. Counsel were well positioned to
prosecute this matter efficiently. Likewise, counsel’s
“substantial knowledge concerning the law governing the issues
in this case” should have minimized the need for time spent in
research. This is not what happened.
5. The pre-existing representation in the reimbursement
cases provided another obvious and significant benefit to the
Hospitals and their counsel. Since counsel represented the
individual hospital in the separate reimbursement matters, the
Hospitals could band together to jointly finance one case that
would resolve the troublesome point of “stabilization” issue
more consistently and more cheaply than if they litigated it in
each and every case. As the basically identical engagement
agreements between each hospital and counsel state: “Because
many hospitals’ interests in [sic] are similar or identical as
it relates to the Alien Issue and in order to keep legal costs
to a minimum, each of the participants in the [hospital] Group
will [sic] have agreed that it wishes this firm to represent
them in a Group.”
6. Because of counsel’s pre-existing relationships with
the Hospitals, litigating this matter should have continued or
enhanced the client relationships. The time required for this
matter could not result in lost business opportunities. In
7
fact, by consolidating the issues common to all the clients and
their cases, counsel freed up time to work on other matters.
Presentation of the issue for resolution in a single case also
saved the Hospitals the greater cost of disputing the issue in
each case where the Agency sought reimbursement.
7. The Hospitals and counsel dealt with the only possible
downside of the representation by including disclosures about
joint representation and a waiver of conflict claims in the
engagement letters.
8. This was not a contingent fee case. The agreement
provided for monthly billing and payment from counsel’s trust
account. Each group member made an initial payment of $10,000
to the trust account. Any time the trust account balance dipped
below $15,000, each group member agreed to contribute another
$10,000 to the trust account. For counsel, this representation
was about as risk free as a legal engagement can be.
9. The Hospitals and their counsel knew from the outset
that they would have to prove their reasonableness of their fees
and costs if they prevailed and wanted to recover fees. The
Petition for Determination of Invalidity of Non-Rule Policy
seeks an award of fees and costs. They could have adjusted
their billing practices to provide more detail in preparation
for a fees dispute.
8
10. An "unpromulgated rule challenge" presents a narrow
and limited issue. That issue is whether an agency has by
declaration or action established a statement of general
applicability that is a "rule," as defined in section
120.52(16), without going through the required public rulemaking
process required by section 120.54. The validity of the
agency's statement is not an issue decided in an "unpromulgated
rule challenge."
11. Courts have articulated the legal standards for
unpromulgated rule challenges frequently. See, e.g., Coventry
First, LLC v. Off. of Ins. Reg., 38 So. 3d 200, 203 (Fla. 1st
DCA 2010); Dep’t of Rev. v. Vanjaria Enters., 675 So. 2d 252
(Fla. 5th DCA 1996); and the cases those opinions cite.
12. The facts proving the “stabilization” standard were
easy to establish. Many Agency documents stated the shift to
the “stabilization” standard. Documents of Agency contractors
did also. Two examples of how clear it was that the Agency was
applying a new standard were the Agency’s statements in its
2009-2010 and 2010-2011 reports to the Governor on efforts to
control Medicaid fraud and abuse. The reports describe the
“stabilization” standard as “more stringent” and certain to
recover millions of dollars for the Agency.
13. As the Agency’s reports to the Governor indicate, the
stakes were high in this matter. For the Hospitals and other
9
hospitals collectively affected by the Agency’s effort to recoup
past payments by applying the “stabilization” standard,
$400,000,000 was at stake.
14. This matter did not present complex or difficult
issues, legally or factually.
15. The Order of Pre-Hearing Instructions requiring
parties to disclose documents and witnesses and update the
disclosures alleviated the discovery demands present in other
litigation. The Agency’s failure to fully comply with the pre-
hearing instructions and unfounded Motion in Limine added some
additional time demands for the Hospital’s counsel. Nonetheless
the issues were narrow, and the facts were essentially
undisputed, if not undisputable. This matter did not require
extraordinary amounts of time for discovery or preparation.
16. Ordinarily challenges to rules or unpromulgated rules
impose time pressures on the attorneys because of the
requirement in section 120.56 that the hearing commence within
30 days of assignment to the Administrative Law Judge. The time
constraint was not a factor in this case. The Hospitals
requested waiver of the time requirement to permit more time for
discovery. The Agency agreed, and the undersigned granted the
request. Thus the Hospitals had the time their counsel said
they needed to prepare for the hearing.
10
17. The appeal imposed no time constraints. Both parties
received extensions of time for their filings. Seventeen months
passed between filing the notice of appeal and oral argument.
Time for the Administrative Proceeding
18. The total number of hours claimed for the services of
the three lawyers, their claimed hourly rate, and the total fees
claimed appear below.
Joanne B. Erde 458.20 hours $550.00 rate $252,010.00
Donna Stinson 136.20 hours $455.00 rate $61,971.00
Harry Silver 93.40 hours $550.00 rate $51,370.00
Total 687.80 hours $365,351.00
19. The Hospitals’ counsel’s billing records are
voluminous. For the proceeding before the Division, the
Hospitals’ counsel’s invoices list 180 billing entries for the
work of three lawyers. A substantial number of the entries are
block billing. In block billing, all of a lawyer’s activities
for a period of time, usually a day, are clumped together with
one time total for the entire day’s service. It is an
acceptable form of billing. But block billing presents
difficulties determining the reasonableness of fees because a
single block of time accounts for several different activities
and the invoice does not establish which activity took how much
time.
20. Here are representative examples of the block billing
entries from the Division level invoices:
11
August 20, 2012 (Erde) – Conference call with ALJ; telephone
conference with AHCA attorney; telephone conference with
newspaper reporters – 2.0 hours
September 16, 2012 (Erde) – Review depositions; prepare opening
remarks; develop impeachment testimony – 5.50
September 27, 2012 (Erde) – Intra-office conference; finalize
interrogatories; work on direct – 8.50
October 2, 2012 (Stinson) – Review and revise Motion in Limine;
Telephone conferences with Joanne Erde and Harry Silver; review
emails regarding discovery issues - `2.60
October 19, 2012 (Erde) – Intra-office conference to discuss
proposed order; Research Re: other OIG audits; research on
validity of agency rules – 2.10 hours
November 9, 2012 (Erde) – Conference with ALJ; Intra-Office
conference to discuss status; further drafting of proposed order
– 7.70 hours.
November 19, 2012 (Stinson) – Final Review and Revisions to
Proposed Final order; Telephone conferences with Joanne Erde to
Review final Changes and comments; Review AHCA’s proposed order
and revised proposed order – 3.20 hours.
21. Many of the entries, block or individual, do not
provide sufficient detail to judge the reasonableness of the
time reported. “Prepare for deposition and hearing,” “review
depositions,” “review new documents,” “review draft documents,”
“intra-office conference” and “attention to discovery” are
recurrent examples.
22. Senior lawyers with more expertise and higher billing
rates are expected to be more efficient. This, the fact that
the matter was not complicated, the relative simplicity of the
issue, and the fact that the Hospitals’ counsel already had a
great deal of familiarity with the facts and law involved, all
require reducing the number of hours compensated in order for
them to be reasonable. For this matter, in these circumstances,
12
the claimed number of hours is quite high. The claimed 687.80
hours amounts to working eight hours a day for 86 days, two of
which were the hearing. This is not reasonable.
23. A reasonable number of hours for the proceedings
before the Division is 180. That is the equivalent of 22.5
eight-hour days. That is sufficient to handle the matter before
the Division from start to finish. The number includes
consideration of the worked caused by the needless difficulties
presented by the Agency in discovery and with its Motion in
Limine.
Time for the Appellate Proceeding
24. The fees that the Hospitals seek for the appeal are
broken down by hours and rates as follows:
Joanne B. Erde
(’13)
255.10 hours $560.00 $142,856.00
Joanne B. Erde
(’14)
202.80 hours $580.00 $117,624.00
Donna Stinson
(’13)
88.50 hours $460.00 $40,710.00
Donna Stinson
(’14)
67.10 hours $500.00 $33,550.00
W.D. Zaffuto 48.30 hours $435.00 $21,010.50
Rob Peccola
(’13)
10.90 hours $275.00 $2,997.50
Rob Peccola
(’14)
17.50 hours $300.00 $5,250.00
L. Rodriguez-
Taseff
(’13)
6.20 hours $520.00 $3,224.00
L. Rodriguez-
Taseff
(’14)
19.50 hours $545.00 $10,627.50
Rachel Pontikes 38.20 hours $515.00 $19,673.00
Total 754.10 hours $397,522.50
25. For the appellate proceeding, the invoices present 341
entries, a substantial number of which are block billing for
work by six lawyers. Here are representative examples from the
appellate level invoices:
13
May 16, 2013 (Erde) – Reviewed AHCA’s initial brief; intra-
office conference to discuss; preliminary review of record –
2.90
May 24, 2013 (Erde) – Intra-office conference to discuss
response to brief; preparation to respond to brief – 2.50
May 30, 2013 (Erde) – Attention to Appeal issues; finalize
request for extension; brief research re jurisdictional issues –
1.60
June 18, 2013 (Peccola) – Strategy with J. Erde regarding
research needs; review/analyze case law cited in answer brief;
conduct legal research regarding documentary evidence and
exhibits on appellate review; write email memo to J. Erde
regarding same – 2.00
July 19, 2013 (Zaffuto) – Revise/draft Answer Brief; discuss
extension of time with H. Gurland; research appellate rules
regarding extension of time and staying proceedings pending
ruling on motion; review appendix to answer brief; instructions
to assistant regarding edits and filing of answer brief and
appendix prepare answer brief for filing; call to clerk
regarding extension of time review initial brief by AHCA and
final order by ALJ – 5.50
August 14, 2013 (Erde) – Intra-office conference to discuss
brief; further revised brief – 5.80
August 15, 2013 (Stinson) Reviewed appellees' answer brief;
discussed language in answer brief with Joanne Erde – 2.50
October 9, 2013 (Stinson) – Review draft motion to relinquish
regarding admission of exhibit; exchange e-mails with Joanne
Erde; telephone conference with Joanne Erde – 1.60
October 10, 2013 (Erde) – Attention to new motion re
relinquishing jurisdiction; review of revisions; further
revisions – 6.00
October 30, 2013 (Erde) – Research re: AHCA’s current behavior;
intra-office conference to discuss status of action at DOAH -
.70
November 7, 2013 (Peccola) – Strategy with J. Erde regarding
Appellees’ response in opposition to Appellant’s motion for
supplemental briefing; conduct research regarding same; draft
same; look up 1st DCA local rule on appellate motions and email
same to J. Erde – 3.60
December 5, 2013 (Erde) – Research Re: supplemental briefing
issues; research to find old emails from AHCA re: inability to
produce witnesses -.90
January 21, 2014 (Rodriguez-Taseff) – Working on Supplemental
Answer Brief – legal argument re authentication and cases
distinguishing marchines [sic]; editing facts – 6.70
14
February 3, 2014 (Erde) – Review and revise response to motion
for further briefing; intra-office conference to discuss same –
2.20
May 2, 2014 (Pontikes) – Continue to review relevant case law
regarding the definition of an unpromulgated rule; continue to
analyze the briefs and the arguments; continue to draft an
outline of the argument discussed – 5.00
June 5, 2014 (Erde) – draft email to group regarding AHCA’s
settlement offer; reviewed supplemental settlement offer from
AHCA; draft email to group re same – 1.70
June 11, 2014 (Erde) – Attention to finalizing response to
AHCA’s notice of dismissal and filing of fee petition; memo to
members of group – 8.00
July 21, 2014 (Erde) – completed motion for rehearing re: fees
as sanctions; drafted status report for DOAH regarding status of
DCA opinion; drafted status report in companion case; emails
with AHCA re: withdrawing pending audits – 6.90
July 21, 2014 (Peccola) – Strategy with D. Stinson and J. Erde
regarding motion for rehearing; revise/edit same; review/revise
edit notices in trial court 1.20.
26. The descriptive entries in the invoices for the
appellate representation also lack sufficient detail. Examples
are: “begin preparation to respond to AHCA”s brief,” “attention
to appeal issues,” “preparation to draft answer brief,” and
“research and draft answer brief.”
27. For the appellate proceedings, Duane Morris added four
lawyers, none with experience in Florida administrative or
appellate matters. W.D. Zaffuto, L. Rodriguez-Taseff, and
Rachel Pontikes are senior level lawyers in Duane Morris offices
outside of Florida. Rob Peccola is a junior level lawyer from a
Duane Morris office outside of Florida. The apparent result is
those lawyers spending more time on issues than the more
experienced Ms. Erde and Ms. Stinson would.
15
28. One example of this is a July 19, 2013, billing entry
where a lawyer spent time researching “appellate rules regarding
extension of time and staying proceedings pending ruling on
motion.” The two lawyers primarily responsible for this matter,
both laying claim to Florida appellate expertise, would only
need to quickly check the Florida Rules of Appellate Procedure
to confirm their recollection of the rules, something that would
probably take less time than it took to make the time entry and
review the draft bill.
29. Hospitals’ also filed a puzzling motion that presents
a discreet example of needless attorney time billed in this
matter. The Hospitals expended 21.8 hours on a Motion for
Rehearing of the court’s order awarding them fees and costs.
The court’s opinion and the Final Order stated that fees and
costs were awarded under section 120.595(4)(a), Florida
Statutes. Yet the Hospitals’ motion fretted that fees might be
assessed under section 120.595(4)(b), which caps fees at
$50,000. The court denied the motion.
30. Two things stand out when reviewing the invoices for
the appellate proceeding. The first is that the appeal took
more hours than the trial proceeding. A trial proceeding is
generally more time-consuming because of discovery, a hearing
much longer than an oral argument, witness preparation, document
review, and preparing a proposed order.
16
31. The second is the sheer number of hours. Hospitals’
counsel seeks payment for 754.10 hours in the appellate
proceeding. This is 66.3 more than for the Division proceeding.
It included a two day hearing, trial preparation, research, and
preparing a 37 page proposed final order. In eight-hour days
the claimed hours amount to a staggering 94.26 days. That
amounts to one lawyer working on the appeal for eight hours a
day for three months.
32. Of this time, 613.5 hours were spent by Ms. Erde and
Ms. Stinson, lawyers with expertise in the subject area, who had
prepared the case for hearing, who participated in the hearing,
who closely reviewed the entire record for preparation of their
proposed final order, who researched the issues before the
hearing and for the proposed final order, and who wrote the
proposed final order. With all this knowledge and experience
with the record and the law, handling the appeal should have
taken less time than the proceeding before the Division.2/
33. One factor supports the appellate proceeding taking as
many hours, or a few more hours, than the administrative
proceeding. It is the Agency’s disputatious conduct over a
scrivener’s error in the Final Order which erroneously stated
that the Agency’s Exhibit 1 had been admitted. The Agency’s
conduct increased the time needed to represent the Hospitals in
the appeal.
17
34. The Agency relied upon the exhibit in its initial
brief, although it twice cited page 359 of the transcript where
the objection to the exhibit was sustained. Also the Agency’s
and the Hospitals’ proposed final orders correctly stated that
Agency Exhibit 1 had not been admitted.
35. The Hospitals’ Answer Brief noted that Agency
Exhibit 1 had not been admitted. The transcript of the final
hearing and both parties’ proposed final orders were clear that
the exhibit had not been admitted. Yet the Agency argued in its
Reply Brief that it had been.
36. This required the Hospitals to move to remand the case
for correction of the error. The Agency opposed the motion.
The court granted the motion. The Final Order was corrected and
jurisdiction relinquished back to the court. The Agency used
this as an opportunity to trigger a new round of briefing about
whether Exhibit 1 should have been admitted. This has been
considered in determining the reasonable number of hours for
handling the appeal.
37. A reasonable number of hours for handling the appeal
is 225. Converted to eight-hour days, this would be 28.13 days.
38. For the appeal, Duane Morris attributes 28.4 hours of
the work to a junior lawyer. This is 3.8 percent of the total
time claimed. Applying that percentage to 225 hours, results in
18
8.6 hours attributed to the junior lawyer with the remaining
216.45 hours attributed to senior lawyers.
Attorneys and Fees
39. Each party presented expert testimony on the issues of
reasonable hours and reasonable fees. The Agency presented the
testimony of M. Christopher Bryant, Esquire. The Hospitals
presented the testimony of David Ashburn, Esquire.
40. As is so often the case with warring experts, the
testimony of the witnesses conflicts dramatically. Mr. Bryant
opined that a reasonable rate for senior lawyers, such as
Ms. Erde and Ms. Stinson, ranged between $350 and $450 per hour.
The reasonable rate for junior lawyers was $200 per hour.
Mr. Ashburn opined that the reasonable hourly rate for senior
lawyers ranged between $595 and $700 and the reasonable rate for
junior lawyers was between $275 and $300.
41. The contrast was the same for the opinions on the
reasonable number of hours needed to handle the two stages of
this litigation. Mr. Bryant testified that the administrative
proceeding should have taken 150 to 170 hours and that the
appeal should have taken 175 to 195 hours. Mr. Ashburn
testified that the Hospitals’ claimed 687 hours for the
proceeding before the Division and 754.10 hour for the appellate
proceeding were reasonable.
19
42. The Hospitals argue that somehow practicing in a large
national law firm, like Duane Morris justifies a higher rate.
The theory is unpersuasive. A national law firm is nothing
special. There is no convincing, credible evidence to support a
conclusion that lawyers from a national firm in comparison to
smaller state or local firms provide better representation or
more skilled and efficient lawyering that justifies a higher
rate.
43. Based upon the evidence presented in this record, a
reasonable rate for the senior lawyers participating in this
matter is $425 per hour. A reasonable rate for the junior
lawyer participating in this matter is $200.00.
Fee Amounts
44. A reasonable fee amount for representation in the
proceeding before the Division of Administrative Hearings is
$76,500. A reasonable fee amount for the proceeding before the
First District Court of Appeal is $93,701.25.
Costs
45. Hospitals seek $6,333.63 in costs. The evidence
proves these costs are reasonable. The Agency does not dispute
them.
20
CONCLUSIONS OF LAW
Jurisdiction
46. The Division has jurisdiction over the parties to and
the subject matter of this matter. §§ 120.569, 120.57(1), and
120.595, Fla. Stat. (2015); First DCA Opinion in Case No. 1D13-
0224 (July 16, 2014).
Basic Principles
47. Florida Patient's Compensation Fund v. Rowe, 472 So.
2d 1145 (Fla. 1985), as modified by Standard Guaranty Insurance
Company v. Quanstrom, 555 So. 2d 828 (Fla. 1990), requires using
a lodestar approach and considering the eight factors
articulated in Rule 4-1.5(a), Florida Rules of Professional
Conduct. Sunshine State Ins. Co. v. Davide, 117 So. 3d 1142,
1144 (Fla. 3d DCA 2013).
48. The party seeking fees must prove that the fees
claimed and the time for which they seek payment are reasonable.
See City of Miami v. Harris, 490 So. 2d 69 (Fla. 3d DCA 1985).
The evidence must be sufficient to show what services were
performed. See Warner v. Warner, 692 So. 2d 266, 268 (Fla. 5th
DCA 1997); Tucker v. Tucker, 513 So. 2d 733, 735 (Fla. 2d DCA
1987). Useful evidence includes invoices, records, testimony
and other information detailing services provided. Braswell v
Braswell, 4 So. 3d 4, 5 (Fla. 2d DCA 2009).
21
49. Records should permit a judge to feasibly and
expeditiously engage in review. They must provide sufficient
detail to permit appraisal of their reasonableness. ECOS, Inc.
v. Brinegar, 671 F. Supp. 381, 394 (M.D.N.C. 1987); Accord Smith
v. Smith, 764 So. 2d 650, 651 (Fla. 1st DCA 2000); Cf. N.D. Fla.
Loc. R. 54.1(c)(“A detailed record must provide enough
information to allow the Court to evaluate reasonableness; an
entry like ‘research’ or ‘conference’ without a description of
the subject will not do.”) Many of the invoice descriptions of
work performed do not provide sufficient detail.
50. Where fee documentation is voluminous, like here, a
court may make an across-the-board reduction in hours. Kenny A.
v. Perdue, 532 F.3d 1209, 1220 (11th Cir. 2008).3/ See also,
Loranger v. Stierheim, 10 F.3d 776, 783 (11th Cir. 1994)
(“[A]cross-the-board percentage cuts in the number of hours
claimed or in the final lodestar figure” may be an appropriate
utilitarian approach). An across-the-board reduction in hours
is the practical approach in this case.
51. The tribunal awarding fees should review the evidence
and identify the hours disallowed and the reasons for
disallowance. Norman v. Housing Auth., 836 F.2d 1292, 1304
(11th Cir.1988). The judge is also an expert on the issue of
reasonable and proper fees and may consider his own knowledge
and experience when forming a judgment on the value of services
22
provided. Loranger v. Stierheim, 10 F.3d 776, 781 (11th Cir.
1994), citing Norman, 836 F.2d at 1303.
52. Lawyers and clients may agree to any fee, staffing,
and billing arrangements that they wish. But, when the fee is
shifted to another party, only reasonable fees are awarded.
Hollub v. Clancy, 706 So. 2d 16, 18-19 (Fla. 3d DCA 1997).
53. The standard for the legal service provided is
effective and competitive representation, not perfect
representation. Grendel's Den, Inc. v. Larkin, 749 F.2d 945,
953-54 (1st Cir. 1984).
Application of the Eight Factors
54. Rowe requires first determining a lodestar fees figure
by multiplying the reasonable hourly rates by the number of
hours reasonably spent on the litigation, applying the eight
factors of Rule 4-1.5(b) of the Florida Bar Rules of
Professional Conduct. Standard Guar. Ins. Co. v. Quanstrom, 555
So. 2d 828, 830 (Fla. 1990). "Reasonably expended" means the
time that ordinarily would be spent by lawyers in the community
to resolve this particular type of dispute. It is not
necessarily the number of hours actually expended by counsel in
the case. See In re Estate of Platt, 586 So. 2d 328, 333 (Fla.
1991) (discussing Rowe factors in estate case).
23
55. The eight factors of Rule 4-1.5(b) of the Florida Bar
Rules of Professional Conduct and an evaluation of each in light
of the Findings of Fact follows.
(A) The time and labor required, the novelty and
difficulty of the question involved, and the skill requisite to
perform the legal service properly-–This matter did not present
a novel or difficult question. The governing law is well
established, and the evidence needed was readily available. It
did not require extensive time and labor. Ms. Erde and
Ms. Stinson provided an above-average level of experience and
skill. The $425 hourly rate reflects that.
(B) The likelihood, if apparent to the client, that the
acceptance of the particular employment will preclude other
employment by the lawyer–-Representing the Hospitals in this
matter did not have the potential to preclude other employment.
If anything the reverse is true.
(C) The fee customarily charged in the locality for
similar legal services-–Expert testimony was presented and
considered. The persuasive credible evidence established that
the customary fee for similar legal services in the community
where challenges to unpromulgated rules must be litigated is
$425 per hour for senior lawyers and $200 per hour for junior
lawyers.
24
(D) The amount involved and the results obtained-–The
amount potentially involved was $400,000,000. The result was
success.
56. After consideration of all the Rowe factors, the
reasonable fee for representation in the proceeding before the
Division is $76,500. After consideration of all the Rowe
factors, the reasonable fee for representation in the appellate
proceedings is $93,711.25.
Costs
57. The Hospitals spent $6,333.63 for deposition costs,
external printing and duplicating for the hearing and
depositions, and for the final hearing transcripts. These costs
are reasonable and not challenged by the Agency.
25
ORDER
Based upon the foregoing Findings of Fact and Conclusions
of Law, it is ORDERED that the amount of attorney’s fees
assessed against the Agency for Health Care Administration is
$170,211.25. The amount of costs assessed against the Agency
for Health Care Administration is $6,333.63. The Agency shall
pay these fees and costs, totaling $176,544.88, within 30 days
from the date of this Order.
DONE AND ORDERED this 1st day of August, 2016, in
Tallahassee, Leon County, Florida.
S JOHN D. C. NEWTON, II
Administrative Law Judge
Division of Administrative Hearings
The DeSoto Building
1230 Apalachee Parkway
Tallahassee, Florida 32399-3060
(850) 488-9675
Fax Filing (850) 921-6847
www.doah.state.fl.us
Filed with the Clerk of the
Division of Administrative Hearings
this 1st day of August, 2016.
ENDNOTES
1/ All citations to Florida Statutes are to the 2012 compilation
unless noted otherwise.
26
2/ “It is simply not conceivable to us that the ablest of
lawyers, having covered the same ground in arguments in the
district court, would have required the equivalent of a full
week and a half of a billable hours to prepare for oral
argument.” See Grendel’s Den, Inc. v. Larkin, 749 F.2d 945,
953-54 (1st Cir. 1984).
3/ The Florida Supreme Court opinions in Florida Compensation
Fund v. Rowe and Standard Guaranty Insurance Co. v. Quanstrom
rely upon federal court opinions. This makes consideration of
federal court opinions appropriate in this Order. See InPhyNet
Contr. Servs. v. Matthews, Case No. 4D14-3382 (Fla. 4th DCA June
22, 2016), 2016 Fla. App. Lexis 9594, 41 Fla. L. Weekly D1464
(Fla. 4th DCA June 22, 2016) and Vantage View v. Bali E. Dev.
Corp., 421 So. 2d 728, 731 n.3 (Fla. 4th DCA 1982) (federal
cases interpreting Federal Rules of Civil Procedure similar to
Florida Rules are persuasive authority).
COPIES FURNISHED:
Joanne Barbara Erde, Esquire
Duane Morris LLP
Suite 3400
200 South Biscayne Boulevard
Miami, Florida 33131
(eServed)
Donna Holshouser Stinson, Esquire
Duane Morris
Suite 3400
200 South Biscayne Boulevard
Miami, Florida 33131-2318
(eServed)
Harvey W. Gurland, Esquire
Duane Morris, LLP
Suite 3400
200 South Biscayne Boulevard
Miami, Florida 33131
(eServed)
Alex B.C. Ershock, Esquire
Roberts Reynolds Bedard & Tuzzio PLLC
470 Columbia Drive, Suite C101
West Palm Beach, Florida 33409
(eServed)
27
Karen A. Brodeen, Esquire
Office of the Attorney General
The Capitol, Plaza Level 01
Tallahassee, Florida 32399-1050
(eServed)
Richard J. Shoop, Agency Clerk
Agency for Health Care Administration
2727 Mahan Drive, Mail Stop 3
Tallahassee, Florida 32308
(eServed)
Elizabeth Dudek, Secretary
Agency for Health Care Administration
2727 Mahan Drive, Mail Stop 1
Tallahassee, Florida 32308
(eServed)
Stuart Williams, General Counsel
Agency for Health Care Administration
2727 Mahan Drive, Mail Stop 3
Tallahassee, Florida 32308
(eServed)
NOTICE OF RIGHT TO JUDICIAL REVIEW
A party who is adversely affected by this Final Order is
entitled to judicial review pursuant to section 120.68, Florida
Statutes. Review proceedings are governed by the Florida Rules
of Appellate Procedure. Such proceedings are commenced by
filing the original notice of administrative appeal with the
agency clerk of the Division of Administrative Hearings within
30 days of rendition of the order to be reviewed, and a copy of
the notice, accompanied by any filing fees prescribed by law,
with the clerk of the District Court of Appeal in the appellate
district where the agency maintains its headquarters or where a
party resides or as otherwise provided by law.