stating that appeal was indeed argued by Dean Chermerinsky
How later courts described this case
- stating that appeal was indeed argued by Dean Chermerinsky
- holding that a district court need not award different rates for different attorney tasks
- affirming fee award, and rejecting argument that billing was duplicative and unreasonable, because party opposing fee award failed to present evidence identifying, let alone demonstrating, allegedly redundant work
- applying 5% across the board reduction in fees awarded because much of plaintiff counsel’s billed work “could have been delegated to a less experienced member of the litigation team”
Written by the judges who cited it.
The opinion
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
Present: The Honorable CHRISTINA A. SNYDER
Catherine Jeang Not Present N/A
Deputy Clerk Court Reporter / Recorder Tape No.
Attorneys Present for Plaintiffs: Attorneys Present for Defendants:
Not Present Not Present
Proceedings: (IN CHAMBERS) - PETITIONERS’ MOTION FOR ATTORNEYS’
FEES (ECF No. 548-1, filed on November 1, 2019)
INTERVENORS’ MOTION FOR DETERMINATION OF THE
AMOUNT OF ATTORNEYS’ FEES TO BE AWARDED
PURSUANT TO § 1021.5 (ECF No. 549, filed on November 1, 2019)
I. INTRODUCTION & BACKGROUND
Before the Court are petitioners Independent Living Center of Southern California,
Gray Panthers of Sacramento, Gray Panthers of San Francisco, Gerald Shapiro, Uptown
Pharmacy & Gift Shoppe, Central Pharmacy, Tran Pharmacy, Inc., Mark Beckwith, Jason
Young, and Margaret Dowling’s (“petitioners”) and intervenors Sacramento Family
Medical Clinics, Inc., Theodore M. Mazer, Ronald B. Mead, and Acacia Adult Day
Services’ (“intervenors”) motions for attorneys’ fees. On August 6, 2019, the Court
previously determined that both petitioners and intervenors are entitled to a fee award
pursuant to California Code of Civil Procedure § 1021.5, and directed the parties to submit
briefing on the appropriate amount of fees to be awarded. See ECF No. 534 (“Fee Order”).
Petitioners and intervenors filed their briefs, and accompanying materials, on November
1,2019. See ECF No. 548-1 (“Pet. Br.”); ECF No. 549 (“Int. Br.”). Respondent Jennifer
Kent, Director of the California Department of Healthcare Services (“State”), filed
oppositions to each on December 16, 2019. See ECF No. 550 (“State Opp. Int.”), ECF
No. 551 (“State Opp. Pet.”). Petitioners and intervenors filed replies on January 6, 2019.
See ECF No. 556 (“Pet. Reply”), ECF No. 557 (“Int. Reply”).
The facts and procedural history of this long-running action are well known to the
parties and summarized in the prior Fee Order and the Ninth Circuit’s opinion in
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
Independent Living Center of Southern California, Inc. v. Kent, 909 F.3d 272 (9th Cir.
2018). For that reason, they are only briefly discussed here.
Petitioners are healthcare advocacy organizations, providers, and recipients who
participate in California’s Medicaid program, known as Medi-Cal. Between 2008 and
2017, petitioners were represented by Lynn S. Carman, a healthcare litigation specialist
and founder of the Medicaid Defense Fund, who is now deceased. They remain
represented by the law offices of Stanley L. Friedman. Friedman, who principally practices
in the area of criminal defense, joined petitioners’ legal team as an “understudy” to “‘pinch-
hit” for Carman at the beginning of the litigation. See Decl. of Lynn S. Carman, ECF No.
467 (“Carman Decl.”), § 1-3.!
On April 22, 2008, petitioners filed a verified petition for a writ of mandate in Los
Angeles County Superior Court pursuant to California Code of Civil Procedure § 1085.
ECF No. 1. The petition sought to enjoin respondent from implementing California
Assembly Bill X3 5 (“AB 5”), which altered re1mbursement rates for Medi-Cal providers,
on grounds that Section 30(A) of the Medicaid Act, 42 U.S.C. § 1396a(30)(A) preempted
the alterations under the Supremacy Clause of the United States Constitution. The State
removed the action to this Court on the basis of federal question jurisdiction on May 19,
2008. Id. That same day, petitioners filed a first amended verified petition. ECF No. 6
(“FAP”).
Petitioners then moved for a preliminary injunction against AB 5 on May 30, 2008.
The Court denied the motion on June 25, 2008, concluding that petitioners were not likely
to succeed on the merits of their claim because they failed to demonstrate that Section
30(A) of the Medicaid Act was enforceable via a private action brought pursuant to the
Supremacy Clause. Petitioners then sought emergency relief from the Ninth Circuit, which
Carman filed this declaration on June 21, 2015 to support his then-pending
application for attorneys’ fees pursuant to § 1025.1, and to “set out facts that Stanley L.
Friedman has made many false statements in his moving papers for § 1021.5 fees.” Carman
Decl., 2. As discussed below, Carman died in 2017 before the Ninth Circuit reversed the
Court’s order denying the various then-pending applications. See ECF No. 476. After
remand to this Court in November 2018, no party filed a renewed application for § 1021.5
attorneys’ fees on Carman’s behalf, nor did any legal representative of his estate or other
successor-in-interest seek to appear in the action to prosecute the application Carman filed.
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
vacated this Court’s order denying the preliminary injunction, and held that petitioners
could bring a private suit under the Supremacy Clause. See Indep. Living Ctr. v. Shewry,
543 F.3d 1050 (9th Cir. 2008). On remand, this Court issued an order granting in part and
denying in part petitioners’ motion for a preliminary injunction. On August 27, 2008, on
motion by the State, the Court modified the preliminary injunction to apply only to
payments “for services provided on or after August 18, 2008.” In 2009, the Ninth Circuit
eventually affirmed the order granting the preliminary injunction, but reversed the
modification order, holding that the State of California could be held liable for
reimbursements withheld for services provided between July 1, 2008 and August 17, 2008,
as well as prospectively. See Indep. Living Ctr. of S. Cal. v. Maxwell-Jolly, 572 F.3d 644,
660-63 (9th Cir. 2009).
After the Court issued its modified preliminary injunction order, intervenors—
several additional Medi-Cal providers, as well as three healthcare districts, represented by
Hooper, Lundy & Bookman LLP (“HLB”)—moved to intervene in this action pursuant to
Federal Rule of Civil Procedure 24. See ECF No. 151. The Court granted the motion as
to the Medi-Cal providers, but not the healthcare districts on September 15, 2018. See ECF
No. 174. The Court subsequently permitted another group of intervenors represented by
HLB, including the California Hospital Association (“CHA”), to intervene on March 26,
2010. See ECF No. 356.
The Supreme Court granted the State’s petition for certiorari with respect to the
Supremacy Clause issue in 2011. Before oral argument, the Centers for Medicare and
Medicaid Services (“CMS”)}—the federal agency charged with administering Medicaid—
disapproved the State’s proposal to implement AB 5 because it did not satisfy Section
30(A). See Douglas v. Indep. Living Ctr. of S. Cal., 132 S. Ct. 1204, 1209 (2012). After
oral argument, but before the Supreme Court issued its opinion, CMS then approved some
parts of the State’s proposal. Id. On February 22, 2012, the Supreme Court held that
CMS’s combined actions changed the case’s procedural posture, and it vacated the Ninth
Circuit’s judgment affirming the preliminary injunction with instructions on remand to
reconsider the viability of petitioners’ Supremacy Clause preemption theory. Id. at 614-
16.
The parties then entered into mediation, and on September 22, 2014, the Court
granted a joint motion for approval of a settlement agreement that would, in principal,
allow petitioners and intervenors to retain any alleged overpayments they received as a
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
result of the preliminary injunction (notwithstanding the State’s right to seek to recoup
those overpayments following the Supreme Court’s decision in Douglas) in exchange for
releasing their claims against the State. ECF No. 420 (“Settlement Agreement”). Among
other things, the settlement agreement also permitted petitioners and intervenors the right
to seek attorneys’ fees from the State. See Settlement Agreement at § III(C)(1). After the
parties settled, in a related case following Douglas that involved the State of Idaho’s
Medicaid program, the Supreme Court definitively rejected petitioners’ and intervenors’
legal theory, holding that the Supremacy Clause is “not the source of any federal rights and
certainly does not create a cause of action” that permits a private plaintiff to enforce Section
30(A) of the Medicaid Act. See Armstrong v. Exceptional Child Care Ctr., Inc., 135 S. Ct.
1378, 1382 (2015).
Following the settlement, in April 2015, petitioners and intervenors filed motions
for attorneys’ fees pursuant to § 1021.5. The Court initially denied those motions on July
6, 2015, reasoning that the Court could not award attorneys’ fees pursuant to a state law
provision since this case was brought under the Supremacy Clause and involved only
federal claims. See ECF No. 476. Petitioners and intervenors appealed, and the case lay
dormant for more than three years. It was during this time that Carman passed away. The
Ninth Circuit eventually held oral argument on September 26, 2018. HLB partner Craig
Cannizzo argued for the intervenors, while petitioners retained Erwin Chemerinsky, Dean
of the U.C. Berkeley School of Law, to argue in place of Carman. On November 21, 2018,
the Ninth Circuit reversed this Court’s order, holding that petitioners and intervenors
initially brought a state law clatm—the petition for a § 1085 writ of mandate—which
permitted them to seek fees pursuant to § 1021.5. See Kent, 909 F.3d at 280-82. The
parties then filed the instant motions. Having determined that the petitioners and
intervenors are entitled to seek a fee award pursuant to § 1021.5, see Fee Order, the Court
now considers what amount of attorneys’ fees, 1f any, should be awarded.
Il. LEGAL STANDARD
Based on the foregoing, California law provides the substantive rules of decision
governing an award of attorneys’ fees. See Beaty v. BET Holdings, Inc., 222 F.3d 607,
609-10 (9th Cir. 2000). To determine the amount of attorneys’ fees to award pursuant to
§ 1021.5, courts “begin with ‘a lodestar figure based on the reasonable hours spent,
multiplied by the hourly prevailing rate for private attorneys in the community conducting
noncontingent litigation of the same type.’” Highland Springs Conference & Training Ctr.
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘Oo’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
v. City of Banning, 255 Cal. Rptr. 3d 331, 342 (2019) (quoting Ketchum v. Moses, 24 Cal.
4th 1122, 1133 (2001)).
“Once the court has fixed the lodestar, it may increase or decrease that amount by
applying a positive or negative ‘multiplier’ to take into account a variety of other factors,
including the quality of the representation, the novelty and complexity of the issues, the
results obtained, and the contingent risk presented.” Thayer v. Wells Fargo Bank, N.A..,
92 Cal. App. 4th 819, 833 (2001). “There is no hard-and-fast rule limiting the factors that
may justify an exercise of judicial discretion to increase or decrease a lodestar calculation.”
Id. at 834. “[T]he trial court is not required to include a fee enhancement to the basic
lodestar figure,” but “retains discretion to do so in the appropriate case.” Ketchum, 24 Cal.
4th at 1138. Further, “the fact that an award against the state would ultimately fall upon
the taxpayers” may also warrant reducing a lodestar award. Serrano v. Priest, 20 Cal. 3d
25, 49 (1977) (“Serrano HT”); accord Rey v. Madera Unified Sch. Dist., 203 Cal. App. 4th
1223, 1243 (2012). Where a multiplier is sought, “the party seeking the fee enhancement
bears the burden of proof.” Rey, 203 Cal. App. 4th at 1242.
I. EVIDENTIARY HEARING
At the outset, the Court considers petitioners’ request at oral argument for an
evidentiary hearing to bolster the claims they make in their moving papers.* “Fee awards
heed not be preceded by an evidentiary hearing if the record and supporting affidavits
are sufficiently detailed to provide an adequate basis for calculating an award . . . and if the
material facts necessary to calculate the award are not genuinely in dispute.” Sablan v.
Dep't of Fin. of Com. of N. Mariana Islands, 856 F.2d 1317, 1322 (9th Cir. 1988) (internal
citations omitted) (holding that no evidentiary hearing was necessary before determining
an entitlement to attorneys’ fees). For this reason, the Ninth Circuit consistently “affirm|s]
attorneys|’| fee awards supported by ample evidence without requiring
an evidentiary hearing.” Shakey’s Inc. v. Covalt, 704 F.2d 426, 435 (9th Cir. 1983)
(holding that no hearing was necessary before determining amount of attorneys’ fees to
award).
Petitioners’ request is unusual in that it is the petitioners’ fee-claiming attorneys who
ask to present additional evidence to bolster claims as to which they have the burden of
? Intervenors did not join in this request.
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
proof. Petitioners’ counsel have a/ready submitted hundreds of pages of evidence to
support their claim for fees. Petitioners do not contend that additional evidence is needed
to respond to any new matter raised by the State after petitioners submitted their reply. The
Court finds that the parties’ submissions, in combination with other evidence in the record,
is sufficient to provide an adequate basis to calculate a reasonable fee award. To the extent
petitioners seek to justify the reasonableness of their reported hours in the face of Carman’s
statements, an evidentiary hearing would not be helpful to the Court, given that Carman is
not available to appear at any hearing, negating any utility the exercise might otherwise
provide. Moreover, the request for an evidentiary hearing is a belated request to
supplement the record with evidence that has already been, or should have been, previously
submitted.
The Court finds that no evidentiary hearing 1s warranted in these circumstances, and
petitioners’ request is accordingly denied.
IV. DISCUSSION
Intervenors’ counsel, the HLB firm, and petitioners’ sole surviving counsel, the law
offices of Stanley L. Friedman, each move for an award of fees. The Court considers each
motion in turn.
A. —_Intervenors’ Motion
1. Lodestar Calculation
Intervenors’ report a lodestar of $3,195,432.88. See Int. Br. at Attachment A. This
amount reflects 5,080 hours of litigation time, billed by 28 attorneys and legal assistants
between 2008 and 2019, at historic attorney rates between $275/hour for a first-year
associate in 2008 to $1025/hour for a senior partner with 40 or more years of experience
in 2019. See Decl. of Craig J. Cannizzo, ECF No. 549-1 (“Canizzo Decl.”), at Exs. F-G.
As a blended average, the HLB firm claims its lodestar rates are $629/hour.*
3 By “blended average” the Court means the hourly rate determined by dividing the
reported lodestar by the total number of hours reported.
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
a) _Reasonableness of Rates
“The reasonable market value of [an] attorney’s services is the measure of a
reasonable hourly rate.” MBNA Am. Bank, NIA v. Gorman, 147 Cal. App. 4th Supp. 1,
13 (2006). An hourly rate is reasonable if it comports with the “prevailing rate for private
attorneys in the community conducting noncontingent litigation of the same type.”
Ketchum, 24 Cal. 4th at 1133. “The party requesting fees bears the burden of producing
“satisfactory evidence . . . that the requested rates are in line with those prevailing in the
community for similar services by lawyers of reasonably comparable skill, experience, and
reputation.’” Viveros v. Donahoe, No. 10-CV-08593 MMM (Ex), 2013 WL 1224848, at
*2 (C.D. Cal. Mar. 27, 2013) (quoting Blum v. Stenson, 465 U.S. 886, 895-96 n. 11
(1984)); accord Save Our Uniquely Rural Cmty. Env’t v. Cty. of San Bernardino, 235 Cal.
App. 4th 1179, 1184 (2015) (“The party seeking attorney fees [pursuant to § 1021.5] has
the burden of proving that the litigation warranted an award of attorney fees and that the
hours expended and the fees sought were reasonable.”).
Intervenors contend that HLB’s rates are “consistent with what attorneys possessing
comparable skills and experience charge for similar litigation.” Int. Br. at 7. HLB
represents that they are recognized healthcare litigation specialists, and support their
assertions with affidavits from their attorneys, see, e.g., Canizzo Decl., Decl. of Lloyd A.
Bookman, ECF No. 427-1 (“2015 Bookman Decl.”), as well as a declaration from Richard
M. Pearl, Esq., who states that he “specialize|s] in issues related to court-awarded
attorneys’ fees.” See Decl. of Richard M. Pearl, ECF No. 549-2 (“Pearl Decl.), 4] 10-17.
According to data compiled by Pearl, HLB attorneys charge rates that “are well within”
and sometimes below, “the range of rates charged by comparable qualified attorneys for
reasonably similar work.” Pearl Decl. § 12.
The State concedes that HLB attorneys are “experts in the field, capable of handling
complex health care matters.” State Opp. Int. at 21. But the State argues that HLB’s
requested rates are inflated because “firms such as HLB routinely give clients substantial
discounts on their standard market rates.” See State Int. Opp. at 11. Indeed, according to
the State, HLB granted its clients a discount in this matter, and it argues that those
discounted rates, not HLB’s market rates, should dictate the attorney fee award, if any, that
HLB recovers. Id. at 12. The State also contends that HLB’s rates are effectively inflated
because HLB’s highest billing partners performed “75 percent of [HLB’s] work on this
matter,” including for tasks that, the State contends, could have been “performed by less
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
experienced attorneys.” Id. at 12 (citing Cannizzo Decl., | 32, Exs. F, G). See, e.g.,
Orantes-Hernandez v. Holder, 713 F. Supp. 2d 929, 969 (C.D. Cal. 2010) (applying 5%
across the board reduction in fees awarded because much of plaintiff counsel’s billed work
“could have been delegated to a less experienced member of the litigation team”); accord
1130 Hope St. Inv. Assocs., LLC v. Haiem, No. B254143, 2015 WL 1897822, at *11 (Cal.
Ct. App. Apr. 27, 2015) (reducing fee award under California law to account for work that
“could have been prepared by a paralegal or less experienced attorney”).*
The Court finds that HLB’s claimed hourly rates are reasonable. Review of the data
compiled in the Pearl Declaration indicates that HLB’s rates are, in fact, well within the
range of what comparably experienced Los Angeles and San Francisco attorneys with
issue-area experience and expertise charged during the relevant time period. See Pearl
Decl., §§ 10-14. In addition, a court in this circuit found in 2012 that $580/hour was a
reasonable rate for two HLB junior partners in Los Angeles, that $400/hour was a
reasonable rate for an HLB sixth-year associate, and that $300/hour was a reasonable rate
for an HLB second year associate. See Lodi Mem’] Hosp. Ass’n, Inc. v. Blue Cross of
California, 12-CV-1071 WBS (GGH), 2012 WL 3638506, at *10-11 (E.D. Cal. Aug. 22,
2012). Since those 2012 rates are consistent with what HLB seeks to recover for similarly
experienced attorneys in this matter for work done in 2012, see Cannizzo Decl., Ex. G, the
Court finds that these findings further support a finding that HLB’s requested rates are
generally consistent with prevailing community standards.
The State’s opposition arguments are not well-taken. With respect to the State’s
argument that many of the tasks performed by HLB senior attorneys could have been
performed by less experienced associate attorneys, the State has “not explained why [it]
believe[s| certain tasks should have been performed by” less experienced attorneys, and
the State has not shown how the Court “would go about making such a determination, even
if it were appropriate.” Cf. Seldon v. 7-Eleven Inc., No. 14-CV-1621-PJH, 2016 WL
4 Federal courts may consider unpublished California opinions as persuasive
authority. Emp’rs Ins. of Wausau v. Granite St. Ins. Co., 330 F.3d 1214, 1220 n. 8 (9th
Cir. 2003) (stating that the court “may consider unpublished state decisions, even though
such opinions have no precedential value”); Washington v. Cal. City Correction Ctr., 871
F. Supp. 2d 1010, 1028 n. 3 (E.D. Cal. 2012) (“The Court may cite unpublished California
appellate decisions as persuasive authority.”).
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
5953148, at *7 (N.D. Cal. July 5, 2016) (rejecting argument to reduce lodestar on this basis
because a reviewing court “is not required to scrutinize the time sheets to weed out tasks
that may have just as easily have been performed by someone who billed at a lower rate”).
And it is far from clear that such a reduction is even appropriate at all where, as here, all
of the allegedly overbilled tasks at issue “qualify as attorney work.” Id. at *7; see also
Gates v. Rowland, 39 F.3d 1439, 1451 (9th Cir. 1994) (holding that a district court need
not award different rates for different attorney tasks).
The State’s argument that a reduction in the lodestar is justified because “firms such
as HLB routinely give clients substantial discounts” is also without merit. The standard
that determines a reasonable rate is what similarly situated private attorneys in the
community charge for “noncontingent litigation of the same type.” Ketchum, 24 Cal. 4th
at 1133 (emphasis added). Accordingly, the community’s “prevailing hourly rates apply
regardless of whether the attorneys claiming fees charged nothing for their services,
charged at below-market or discounted rates, represented the client on a straight contingent
fee basis, or are in-house counsel.” Glaviano v. Sacramento City Unified Sch. Dist., 22
Cal. App. 5th 744, 751 (2018) (internal marks omitted). The discounts HLB offered its
clients in this case, on which the State relies, were based upon the possibility for a
contingent recovery. See Cannizzo Decl., Ex. B (“As consideration for these and prior
reduction in our fees, we are requesting that our original engagement be modified herein
to include a new provision affording the firm the right to make a fee application in the
federal case in the event of ultimate success.”) (cited in State Opp. Int. at 12). The
discounted rates actually billed thus do not represent the “prevailing rates” for non-
contingent litigation, and are not the proper rates to be used to determine, or reduce, a fee
award.
b) —Reasonableness of Hours Spent
HLB requests fees for 5,080 hours of attorney time between August 4, 2008 and
October 28, 2019. See Int. Br. at Attachment A. HLB reports spending 3,837.6 hours to
litigate and defend the preliminary injunction, 978.4 hours to establish HLB’s eligibility
for a fee award pursuant to § 1021.5, and 264.6 hours to litigate the present motion to
secure a specific amount of fees. See Cannizzo Decl., Ex. F. HLB contends that these
hours are reasonable because, pursuant to the Ninth Circuit’s decision and this Court’s
August 6, 2019 Fee Order, they “are limited to HLB’s representation of the successful non-
institutional provider Intervenors.” Int. Br. at 9. HLB explains that, as a result, the time
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
“spent exclusively on the hospital associations and other [institutional] clients . . . has been
sorted out and removed” from its fee request. Id. at 10.
The State objects to HLB’s stated hours on grounds that HLB should not be
permitted to recover fees (1) that it already recovered from its institutional clients and third
parties, as well as for its time spent (2) litigating the fee motions (“fees on fees”), or (3)
intervening on behalf of its institutional clients. See State Opp. Int. at 4-11. The State also
(4) generally contends that HLB failed to exercise sound billing judgment, and that its
request should be reduced to exclude non-compensable redundancies between counsel.
The State does not otherwise challenge the reasonableness of the total hours devoted to
this litigation by HLB. Given, among other things, the duration and complexity of the
litigation, the Court finds these hours to have been reasonably spent in representing
intervenors in this action.
With respect to the first objection, the State argues that HLB already recovered $1.22
million as part of its recovery from a separate settlement it negotiated for its hospital clients
for work that is “undifferentiated” from the work HLB seeks to recover fees for in this
matter. Id. at 4-5. The State also contends that HLB received $172,326 from “non-client
third parties to support its work in this case.” Id. at 7. HLB acknowledges recovering fees
in the separate settlement, but contends that these fees were for legal services unrelated to
the services claimed by this motion. See Int. Br. at 10; see also Cannizzo Decl., 4] 35-40,
44 (“With respect to 2016 hospital payments received by way of settlement of HLB’s
common benefit fee request . . . these payments were not made for services that are the
subject of this motion.”). HLB also acknowledges that it received $172,326 from a
coalition of interested non-parties who it represents in other matters (including related
challenges to the same Medi-Cal rate reductions), but states that these payments at most
relate to separate benefits it obtained for those parties. See Int. Br. at 12: see also Cannizzo
Decl., § 41.
It is true that HLB “cannot recover the same costs twice.” Bravo v. City of Santa
Maria, 810 F.3d 659, 668 (9th Cir. 2016) (applying California law and citing Regan
Roofing Co. v. Superior Court, 21 Cal. App. 4th 1685,1709-10 (1994)); see. e.g., Pearson
v. Green Tree Servicing, LLC, No. 14-CV-04524-JSC, 2015 WL 632457, at *11 (N_D. Cal.
Feb. 13, 2015) (applying California law to reduce a fee award by the amount “already paid”
because “[a]llowing a double recovery of these fees would not be reasonable”). But, with
regard to the hospital settlement, the State does not identify any specific time entries that
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘Oo’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
it claims to represent a basis for double recovery. Instead, the State only generally argues
that (1) HLB performed undifferentiated work for its hospital/institutional clients as well as
its individual provider clients, (11) HLB recovered some fees for that undifferentiated work,
and (iii) half of the undifferentiated work (and thus half of the fees) relate to benefits
secured for the provider clients at issue in this motion. See State Opp. Int. at 3-5. By
contrast, HLB submitted contemporaneous billing entries detailing the specific work—
excised from this motion—that HLB performed exclusively for HLB’s hospital clients.
See Cannizzo Decl., Exs. I-1, I-2, I-3-, J, K. HLB does not seek to recover these fees, and
limits its motion to only those fees related to HLB’s representation of the individual
intervenors. Id. at Exs. C, D, E (attaching those pertinent time entries).
To the extent some portion of the work reported in HLB’s lodestar in this case related
to HLB’s representation of the individual intervenors also overlaps with the work that gave
rise to HLB’s settlement recovery from its hospital/institutional clients, it 1s within the
Court’s discretion to decline to make a reduction when “it would be impracticable, if not
impossible, to separate the [fee-bearing| time into compensable and noncompensable
units.” Calvo Fisher & Jacob LLP v. Lujan, 234 Cal. App. 4th 608, 625—26 (2015) (stating
that “‘a trial court has discretion to apportion or not apportion attorney fees depending upon
the facts and circumstances before it,” and holding that the trial court had discretion to
decline a requested apportionment in similar circumstances); accord Maxim Crane Works,
v. Tilbury Constructors, 208 Cal-App.4th 286, 298 (2012) (same). This is especially
true where, as here, the party seeking the reduction fails to provide a principled basis “to
separate the multitude of conjoined activities into compensable or noncompensable time
units.” Abdallah v. United Sav. Bank, 43 Cal. App. 4th 1101, 1111 (1996) (holding that
trial court had discretion to decline apportionment).
As for reducing the requested award to take into account the payments HLB received
from its non-party interest group clients, the State cites no authority to support such a
reduction apart from reciting the general rule barring a double recovery. Moreover, even
if these third-party payments were considered compensation for overlapping work
defending the preliminary injunction for the benefit of the individual intervenors, the Court
would decline to apportion those payments, as it does in connection with the hospital client
settlement recovery, because it is hardly clear what attorney work is covered by the
$172,326, let alone what portion of that work 1s attributable to the individual intervenors
as opposed to the third-party beneficiaries. See Calvo Fisher, 234 Cal. App. 4th at 625-26.
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
Second, the State’s argument that HLB may not recover “fees on fees” is not well-
taken. It is well-established that a party may seek to recover attorneys’ fees for the time
spent recovering those fees. Ketchum, 24 Cal. 4th at 1141 (“[A]n award of fees may
include not only the fees incurred with respect to the underlying claim, but also the fees
incurred in enforcing the right to [collect] fees.”). Because nothing in the parties’
settlement agreement expressly precludes the recovery of these fees, and because
California law establishes a presumption that these fees are recoverable, HLB shall
permitted to recover fees for the time it spent seeking fees in this action. See Serrano v.
Unruh, 32 Cal. 3d 621, 624 (1982) (“We conclude that, absent circumstances rendering an
award unjust, the fee should ordinarily include compensation for all hours reasonably
spent, including those relating solely to the fee.”).°
Third, the State contends that HLB improperly seeks to recover for 175 hours of time
related to attempts to intervene on behalf of other clients not party to this case. See State
Opp. Int. at 8 (citing Greenfield Decl., Ex. 29). HLB concedes that it mistakenly requested
$51,998 in fees for time it spent pursuing intervention for hospitals and other non-party
clients. See Int. Reply at 9-10 (citing Greenfield Decl., Ex. 29). HLB states that it intended
to remove this time from its request, and agrees that it should not be permitted to recover
for these hours. Id. HLB contends, however, that the State mischaracterizes other
legitimate time entries, valued at approximately $42,030, as related to time spent
attempting to intervene for third parties (which HLB does not intend to recover) when those
hours in fact relate to the litigation of this case on the merits (which HLB does request to
recover). The Court has reviewed the disputed time entries at issue, and agrees with HLB
that these time entries appear to relate to recoverable work related to the merits of the
instant litigation. See Decl. of Craig Cannizzo in Supp. of Reply, ECF No. 557-1
> The State also argues that HLB should not be permitted to recover for time sent
pursuing a common fund fee award, since recovery for that time is typically not permitted.
See Estate of Trynin, 49 Cal. 3d 868, 876 (1989) (“[A]ttorney fees awarded under the
common-fund and common-benefit theories generally have been held not to include
compensation for fee litigation.”). However, because the State opposed a common fund
recovery and took actions that made such a recovery unworkable in practice such that
petitioners and intervenors were limited to filing the instant motions pursuant to § 1021.5,
the Court, in its discretion, finds that the time spent pursuing the common fund recovery
should be included in the “fees on fees” time that intervenors (and petitioners) may recover.
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
(“Cannizzo Reply Decl.”), {6 and Attachment B. The Court will therefore reduce HLB’s
lodestar by $51,998.
The Court further finds, with respect to the fourth objection, that HLB exercised
reasonable billing judgment, especially given, as noted above, the duration and complexity
of this litigation. There is no basis in the record to find that HLB’s efforts in this case were
“duplicative” or “redundant.” See Tuchscher Dev. Enters., Inc. v. San Diego Unified Port
Dist., 106 Cal. App. 4th 1219, 1248 (2003) (affirming fee award, and rejecting argument
that billing was duplicative and unreasonable, because party opposing fee award failed to
present evidence identifying, let alone demonstrating, allegedly redundant work); Church
of Scientology v. Wollershemm, 42 Cal. App. 4th 628, 659 (1996) (fee award affirmed
where opponent did not present any evidence in the record that the award was based upon
unnecessary or duplicative work); see also Mix v. Tumanjan Dev. Corp., 102 Cal. App. 4th
1318, 1324 (2002) (observing that it is “not unusual for a litigant to be represented by more
than one attorney” and holding that “a litigant entitled to an attorney fee award may recover
attorney fees for both private counsel and in-house counsel,” for example, “provided” that
the request is otherwise reasonable).
Therefore, in its discretion, and for the reasons discussed above, the Court concludes
that the reasonable lodestar for HLB’s services in this litigation is $3,143,434,88.
2. Adjustments To Lodestar
Intervenors contend that HLB’s services to defend the preliminary injunction
warrant a multiplier of 3.0, and that HLB’s services to secure fee award eligibility warrant
a multiplier of 2.0. See Int. Br. at 16-24. Intervenors reason that these multipliers are
justified because (i) the action involved novel, complex, and difficult legal questions, (11)
HLB obtained exceptional results, (111) those results secured important public benefits, (iv)
HLB litigated the action on a contingent basis, and (v) HLB has sustained a delay in
payment. Each of these factors, if established, may, but need not, support an upward
adjustment to the lodestar. See generally Ketchum, 24 Cal. 4th at 1133; e.g., Crommie v.
State of Cal., Pub. Utilities Comm’n, 840 F. Supp. 719, 726 (N_D. Cal. 1994), aff'd 67 F.3d
1470 (9th Cir. 1995) (awarding a multiplier to § 1021.5 fee award because plaintiffs’
counsel “undertook representation of plaintiffs on a contingency basis” and secured
“significant public interest value” by establishing “that a public agency . . . had
systematically engaged in age discrimination’).
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘Oo’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
The State, meanwhile, contends that HLB’s lodestar award should be substantially
reduced to account for (1) Intervenors’ limited success on the merits, (11) the redundant
work performed by HLB attorneys and co-counsel, (111) HLB’s allegedly poor billing
judgment, and (iv) the fact that any fee recovery in this case would fall upon taxpayers and
detract from state’s ability to provide public services. See State Opp. Int. at 12-20. These
factors, if established, also may, but need not, support a downward adjustment to the
lodestar. See Ketchum, 24 Cal. 4th at 1132-33 (citing Serrano III, 30 Cal. 3d at 48): e.g.,
Envtl. Prot. Info. Ctr. v. Dep’t of Forestry & Fire Prot., 190 Cal. App. 4th 217, 238 (2010)
(holding that “a reduced fee award is appropriate” under § 1021.5 “when a claimant
achieves only limited success,” such as “where a prevailing party plaintiff is actually
unsuccessful with regard to certain objectives of its lawsuit’) (quoting Sokolow v. County
of San Mateo, 213 Cal. App. 3d 231, 249 (1989)): Rey, 203 Cal. App. 4th at 1243 (trial
court had discretion to reduce fee award against school district where “it was likely that
any amount paid by the District would instead be cut from educational services that would
otherwise be provided to the District’s students”).
Considering all of these factors, the Court tentatively determined prior to oral
argument that no adjustment of the lodestar was warranted because the factors that favored
a multiplier were offset by other factors that supported a downward adjustment. After oral
argument, and consideration of the record, the Court now determines that a multiplier of
1.5 is warranted in this case. See Ctr. for Biological Diversity v. Cty. of San Bernardino,
185 Cal. App. 4th 866, 899-901 (2010) (holding that trial court had discretion to apply a
multiplier of 1.5 ina § 1021.5 case that secured important public benefits on a contingent
basis, and rejecting defendant’s argument that the trial court was “required to discuss each
of the illustrative factors set forth” in Serrano III). Key to the Court’s conclusion are the
following factors: (i) as the Court previously noted in its tentative order, HLB’s efforts to
defend the preliminary injunction on appeal and on remand after intervening in this case
secured important public benefits; (11) HLB performed this work on a contingent basis that
both risked and significantly delayed HLB’s ability to recover payment for its services; and
(111) although HLB formally intervened in this case after the initial preliminary injunction
was secured, HLB worked with petitioners’ lead counsel Carman to secure that relief prior
to intervention, including by preparing important fact declarations and appearing in court
to argue points related to the administration of the Medi-Cal program. Weighing these
factors against (1) the relatively limited relief obtained through the Settlement Agreement
following the Supreme Court’s order vacating the preliminary injunction in Douglas, 132
S. Ct. at 1209 (later expanded upon in Armstrong, 135 S. Ct. at 1382, in which the Supreme
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
Court held that that the theory that supported the existence of a private right of action upon
which the preliminary injunction was based failed as a matter of law), (11) the possibility
that any fee enhancement might draw from the State’s general fund, see Rey, 203 Cal. App.
4th at 1243 (citing Serrano III, 30 Cal. 3d at 48).° and (iii) the fact that HLB’s hourly rates
already reflect the skill and expertise needed to navigate the legal and procedural issues in
this case, see Flannery v. California Highway Patrol, 61 Cal. App. 4th 629, 645 (1998)
(noting that “factors such as the novelty and complexity of the case and the special skill
and experience of counsel are necessarily reflected in the lodestar and do not” necessarily
“merit an enhancement of that figure’’); accord Ketchum, 24 Cal. 4th at 1138 (asserting
that “a trial court should not consider these [multiplier] factors to the extent they are already
encompassed in the lodestar’’), the Court concludes that a multiplier of 1.5 is appropriate.
For these reasons, the Court concludes that HLB shall be awarded 1.5 times its
lodestar of $2,222,557 for time spent litigating the merits of this action, subtotaling
$3,333,835.50, plus its unadjusted lodestar of $920,878.38 for time spent litigating its fee
application, for a total award of $4,254,713.88. See Int. Mot. at Att. A (breaking down
intervenors’ lodestar for each stage of litigation).
B. Petitioners’ Motion
1. Lodestar Calculation
Petitioners’ surviving counsel, Stanley L. Fmedman, reports a lodestar of
$7,714,970.90. See Pet. Br. at 3. Friedman claims that this figure—more than twice the
lodestar reported by intervenors’ counsel—teflects 8,699.20 hours of attorney time, billed
by Friedman and two other attorneys at his firm between 2008 and 2019, at attorney rates
of $899/hour for Friedman and his partner Rafael Bernardino, and $747/hour for
Friedman’s more junior associate Ashton Watkins. See Friedman Decl., □□□ 3-4.’
° The Court applies less weight to this factor, but considers it nonetheless. See
Serrano III, 30 Cal. 3d at 48.
7 A third attorney who apparently worked with Friedman, Christopher Pantel, also
billed time to the matter in 2015 (not more than 29.7 hours), and Friedman includes his
hours at the same rate billed by attorney Watkins ($747/hour) in combination with the
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
Friedman’s requested lodestar of $6,422,577.50 through 2015 alone is more than five times
as much as the $1,180,500 lodestar that petitioners’ lead counsel Lynn Carman requested
for that same time period. Compare id. Ex. 1 with Mot. for Attorneys’ Fees, ECF No. 430
(“Carman Fee Mot.”), at 1. As a blended average rate, Friedman requests lodestar fees at
$887/hour. Friedman claims these rates represent the prevailing market rates for his
services, even though they substantially exceed the undiscounted historic hourly rates he
actually charged clients during the same period reported in this case. Compare Friedman
Decl., Ex. 1 (using “prevailing hourly rates” to arrive at the $7,714,970.90 figure) with id.
Ex. 3 (using “historic hourly rates” actually charged to his clients to arrive at an alternate
lodestar of $5,461,410, which translates to a blended average rate of $628/hour).
a) Reasonableness of Rates
As stated above in connection with the intervenors’ motion, the party seeking fees
“bears the burden of producing ‘satisfactory evidence . . . that the requested rates are in
line with those prevailing in the community for similar services by lawyers of reasonably
comparable skill, experience, and reputation.’” Viveros, 2013 WL 1224848, at *2
(quoting Blum, 465 U.S. at 895-96 n. 11); accord Ketchum, 24 Cal. 4th at 1133. Following
this standard, the Court cannot conclude that the “prevailing rates” requested by the
Friedman firm are reasonable.
To begin with, the Friedman firm requests compensation at blended average billable
rates ($887/hour) that are, on average, 140% of the blended average billable rates requested
by the HLB firm and approved by the Court. These rates are also substantially greater than
the rates that Carman—the attorney for whom Friedman served as an “understudy”—
requested in his motion for attorneys’ fees in 2015. See Carman Fee Mot. at | (requesting
an hourly rate of $750/hour). The Court’s conclusion approving HLB’s rates—a blended
average of $629/hour, heavily weighted toward time billed by senior partners with decades
of practice experience in healthcare law relevant to this litigation—tested to a substantial
degree on HLB’s management, as lead counsel for the intervenors, of complex healthcare
and constitutional litigation. See, e.g., Canizzo Decl., {9 3-4, Ex. A; Pearl Decl., 4 10-17;
see also State Opp. Int. at 21 (acknowledging that HLB attorneys are “experts in the field,
capable of handling complex health care matters”). Neither Friedman, nor the attorneys
hours billed by Watkins. See Decl. of Stanley L. Friedman, ECF No. 548-2 (“Friedman
Decl.”), at Exs. 1-3 at n. 1.
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
with his firm, performed comparable work. Nor did petitioners retain Friedman in order to
perform that kind of work. See Carman Decl., 4 2-3.
As Carman averred in his declaration, petitioners only retained Friedman as an
“understudy” because of their concerns with Carman’s age, health, and auditory
challenges. Carman Decl., { 2. And Carman only agreed to affiliate Friedman as his
“subordinate associate counsel” to serve as a “backup attorney to carry on if something
happened” that prevented Carman from representing petitioners at a hearing or at trial. Id.
Before Carman died on February 12, 2017, nearly nine years after this litigation
commenced, Friedman’s role had been limited, and Carman involved Friedman “solely to
meet thle] insurance back-up requirement” that petitioners requested. Id. | 2, 3a-3b.
According to Carman, Friedman’s “function was to do nothing,” apart from prepare to
“step in” in the event he was needed. Id. § 3a.
During Carman’s lifetime—which included his work at every stage of this litigation
prior to the fee eligibility proceedings remanded to this Court in November 2018—
Friedman’s “assigned task was to sit on the bench” and simply “understand every
document” Carman gave him. Id. Carman was responsible for “everything else related to
the lawsuit,” including “legal research,” “gather|ing] the evidence,” “writ[ing] and fil[ing]
all the pleadings, motions, appeals, appeal briefs and other papers,” and presenting “all the
oral motions and appellate oral arguments.” Id. § 3b.2 From the Court’s review of its
docket, and from its observations managing this case for nearly 12 years, the Court finds
that the Friedman firm does not demonstrate that it briefed most substantive pleadings in
the district court, or the Ninth Circuit, while Carman was alive. See id. § 4 (“Contrary to
his time sheets, Friedman did not in fact prepare, revise, or finalize any complaint,
8 At the hearing on held on his application, Friedman challenged Carman’s account
of the petitioners’ division of labor. According to Friedman, Carman could not have taken
the lead in representing petitioners because Carman suffered from cognitive limitations
that prevented him from performing the work of lead counsel. Counsel for the State, who
dealt directly with Carman throughout this litigation and in other matters, disputed any
suggestion that Carman suffered from cognitive limits other than hearing loss. The Court,
having held hours of hearings in this case at which Carman appeared and took a principal
role, observed that at all times, Carman demonstrated a full grasp of the issues and legal
arguments. Apart from his hearing difficulties, he exhibited no cognitive limitations.
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
pleadings, motions, declarations, or briefs in these two cases”): Donahue v. Donahue, 182
Cal. App. 4th 259, 276 (2010) (holding that trial courts “may rely on their own experience
about reasonable and proper fees” in part because “[i]n many cases, the trial court will
be aware of the nature and extent of the attorney’s services from its observation of the trial
proceedings and the pretrial and discovery proceedings reflected in the file”): accord In re
Rossco Holdings, Inc., No. CV 14-917-JFW, 2014 WL 2611385, at *8 (C.D. Cal. May 30,
2014) (holding that the court “was sufficiently familiar with the underlying litigation to
assess the reasonableness of the request’) (applying California law and citing Donahue).°
Additionally, apart from standing in for Carman at the July 11, 2008 telephonic
hearing before the Ninth Circuit—the hearing at which the Ninth Circuit vacated the
Court’s prior order denying the preliminary injunction and granted petitioners’ motion
(authored by Carman) for a temporary restraining order enjoining the implementation of
AB 5(X) until August 11, 2008—Friedman does not appear to have argued any substantive
motion or appeal at any stage of the litigation.‘ Even before Carman died, petitioners
° At the hearing, Friedman disputed this assertion. Asked to explain which
pleadings, motions, and briefs he drafted, Friedman stated that he prepared “all of them.”
Compare Carman Decl., § 4(b) (explaining that “it is easy to see when documents are
prepared, revised, finalized or filed by Carman, because Carman does not use any vertical
line on the right; has never used a double vertical line on the left; and his text lines never
touch any vertical line on the left, and Carman, not Friedman, signs them”). The Friedman
firm may well have assisted with the electronic filing, formatting, and editing of
documents, given that Friedman is the electronic filer on many documents signed by
Carman filed using Carman’s preferred formatting. However, based on the Court’s
observations, supported by the sworn statement from Carman, the Court finds that
Friedman’s claim to the effect that the Friedman firm prepared “all” of the pleadings,
motions, and briefs in this case is not supported by the evidence. See Donahue, 182 Cal.
App. 4th at 276. This conclusion is corroborated, in part, by the differences the Court has
observed between pleadings filed by petitioners while Carman was alive, and pleadings
filed by Friedman following remand from the Ninth Circuit after Carman died. The Court
considers all of this evidence in assessing the relative roles of counsel in this litigation.
10 The Court notes that Carman’s hearing difficulties prevented him from
participating in telephonic conferences and arguments. See also Carman Decl., {3a n. 1.
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
retained Dean Chemerinsky to brief its pending appeal before the Ninth Circuit. See
Appellants’ Opening Br., Indep. Living Ctr. v. Shewry, No. 15-56142, ECF No. 4 (9th Cir.
Jan. 4, 2016) (brief authored by Dean Chermerinsky as lead counsel). And after Carman
passed away, Dean Chermerinsky, not Friedman, argued that appeal. Id. at ECF No. 60
(acknowledgment of hearing notice indicating that Dean Chermerinsky would argue the
appeal); see also Kent, 909 F.3d at 272 (stating that appeal was indeed argued by Dean
Chermerinsky). Although Friedman claims, without proffering any documentary support,
that he was equally responsible for the briefing, at oral argument, Friedman conceded that
Dean Chermerinsky made “substantial” edits and contributed many helpful ideas to the
appellate briefs.
Against these facts, petitioners attempt to carry their burden in support of their
requested rates with narrative affidavits from attorneys at the Friedman firm attesting to
their skills and experience,'! as well as an affidavit from Kevin Gerry, Esq., who represents
that he is an expert in fee award determinations. See Decl. of Kevin Gerry, ECF No. 548-
2 at 28 (“Gerry Decl.”). The Gerry declaration offers two key conclusions. First, Gerry
concludes that the Friedman firm’s historic rates—$750/hour for Friedman and
Bernardino, and $500/hour for Watkins and Pantel—are well within the range of prevailing
hourly rates awarded by district courts in this circuit given Friedman and his associates
experience and expertise. See Gerry Decl., 7-10. Second, Gerry also concludes that the
Friedman firm’s requested prevailing rates—$899/hour for Friedman and Bernardino and
$747/hour for Watkins and Pantel—are also reasonable. Id., §] 15-17.
Neither conclusion is persuasive. With respect to historic rates, the average blended
rate for the Friedman firm at its historic rates ($628/hour) is virtually identical to the
average blended rate requested by, and approved for, the lead counsel retained by
intervenors at HLB ($629/hour). The Friedman firm cannot reasonably command the same
'! Tn their moving papers and at oral argument, counsel for the Friedman firm attest
that they have substantial experience handling complex litigation related to healthcare.
Friedman in particular describes representing private clients in matters involving health
insurance, and representing the United States against healthcare companies and involving
healthcare fraud while an Assistant United States Attorney. The Court notes this evidence,
and considers it as part of its determination of the reasonable lodestar hourly rate for the
Friedman firm.
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
rates for their support work as the attorneys at HLB who actually, along with Carman, took
the lead roles in litigating this case.
Gerry’s conclusion regarding the prevailing market rate for the Friedman firm’s
services 1s, accordingly, even less persuasive. Gerry’s conclusion supporting the request
rests significantly, if not exclusively, upon the so-called “Laffey Matrix.” See Gerry Decl.,
15-17. “Approved originally in Laffey v. Northwest Airlines, Inc., 572 F. Supp. 354
(D.D.C. 1983), aff'd in part, rev'd in part on other grounds, 746 F.2d 4 (D.C. Cir. 1984),
the Laffey matrix is an inflation-adjusted grid of hourly rates for lawyers of varying levels
of experience in Washington, D.C.” Prison Legal News v. Schwarzenegger, 608 F.3d 446,
454 (9th Cir. 2010). The Ninth Circuit, however, has cast significant doubt on the matrix’s
utility, much less its utility outside of the District of Columbia. See id. at 454 (affirming
trial court’s decision not to apply the matrix, concluding that it “is questionable whether
the matrix is a reliable measure of rates,” and explaining that “just because
the Laffey matrix has been accepted in the District of Columbia does not mean that it is a
sound basis for determining rates elsewhere, let alone in a legal market 3,000 miles
away.”). The Ninth Circuit’s reticence to apply the ngid Laffey matrix appears especially
appropriate here, where the suggested rates for the Friedman firm’s work in a supporting
role are so plainly incommensurate with other common sense indicators, such as the rates
found reasonable for intervenors’ lead counsel. See. e.g., Housing Rights Center v.
Sterling, No. 03-CV-0859 DSF, 2005 WL 3320738, *2 (C.D. Cal. Nov. 1, 2005) (finding
that the Laffey matrix “does not comport with the reality of Los Angeles firm billing
practices.”’).
“When a fee applicant fails to meet [its] burden of establishing the reasonableness
of the requested rates, the court may exercise its discretion to determine reasonable hourly
rates based on its experience and knowledge of prevailing rates in the community.”
Viveros, 2013 WL 1224848, at *2 (citing cases); accord Morris v. Hyundai Motor Am.,
41 Cal. App. 5th 24, 41 (2019) (‘In making its calculation of a reasonable hourly rate, the
court may rely on its own knowledge and familiarity with the legal market, as well as the
experience, skill, and reputation of the attorney requesting fees,” as well as “the difficulty
or complexity of the litigation to which that skill was applied.”) (internal brackets omitted).
The Friedman firm has not submitted evidence to carry its burden that either its
requested or historic rates are reasonable for the services provided in this litigation. Based
on the foregoing, the Court concludes that a reasonable average blended hourly rate for
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES — GENERAL ‘Oo’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
work performed by the Friedman firm while Carman was alive (through 2016) is
$566/hour, which represents 90% of the average blended hourly rate approved by the Court
for the intervenors’ attorneys at HLB. This rate is comparable to what HLB charges clients
for its more junior and mid-level attorneys’ time, which the Court deems appropriate given
that the Friedman firm typically only performed the support work of a more junior attorney
during this time. Compare Cannizzo Decl. at Exs. F-G. The Court further determines that
a reasonable average blended hourly rate for work performed by the Friedman firm after
Carman died (2017-present) is $628/hour, which reflects the Friedman firm’s historic rates.
b) —Reasonableness of Hours Spent
The Friedman firm claims that it expended 8,699.20 hours of billable time on this
matter. See Friedman Decl., □□□ 3-4. That is 3,619.20 hours more than (171% of) the 5,080
hours reported to have been expended by the attorneys at HLB. Compare Cannizzo Decl.,
Exs. F-G.” The State contends that this request “represents enormous overreach.” State
Opp. Pet. at 1.
It is unreasonable for a “subordinate” or “understudy” to bill 3,000-plus additional
hours more than the HLB attorneys who played a lead role. See Carman Decl., § 2-3. The
request is particularly unreasonable because the Friedman firm is not attempting to recover
any time billed by lead counsel Lynn Carman, who litigated this case for nearly 10 years,
or Dean Chermerinsky, who briefed and argued the most recent Ninth Circuit appeal after
Carman passed away. The 8,699.20 hours for which the Friedman firm seeks
compensation represents time spent by Friedman and his associates alone. See also, supra,
2 The Friedman firm claims that the 5,080 hour figure is misleading because HLB
actually billed, and originally requested fees for, more than 7,000 hours. See Pet. Reply at
2 n. 3 (citing ECF Nos. 427, 428). However, the 5,080 hours figure reflects the “time
associated with the benefits achieved on behalf of Intervenors in this mater, to the exclusion
of other parties and lawsuits.” Int. Br. at 9 (emphasis added); see also Cannizzo Decl.,
| 35-40. HLB properly calculated this lower figure following this Court’s and the Ninth
Circuit’s prior decisions instructing petitioners and intervenors to determine the amount of
time spent achieving benefits for their clients in this matter. Id. As a result, the larger hour
figure cited by the Friedman firm—which is not included in HLB’s motion, and which
incorporates time spent litigating other matters for other parties—is not the relevant point
of comparison.
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
n. | (explaining that no one filed an application for attorneys’ fees on Carman’s behalf
following remand). It is not reasonable to conclude that these supporting attorneys at the
Friedman firm could have billed nearly five times as many hours through 2015 (7,261.6
hours) as lead counsel Carman, who drafted and argued virtually all of the pleadings in this
case, and who in 2015 only sought to recover fees for 1,574 hours of work. See Mot. for
Attorneys’ Fees, ECF No. 430 (“Carman Fee Mot.”).!° In addition, with respect to the
difference between the time reported to have been expended by HLB and the Friedman
firm, even if the Friedman firm’s work on this case began two to four months before
counsel at HLB, the gulf between the time supporting attorneys reasonably expended while
sitting “on the bench” throughout most of this litigation, and the time the Friedman firm
actually reports relative to HLB, cannot be reconciled.
The State raises several specific points that illustrate that Friedman’s request cannot
survive scrutiny. First, the State’s billing analyst, Gary Greenfield, found numerous
“indications that the Friedman firm time entries are not accurate or reliable reflections of
work done and that the time billed is more than what was actually or should have
reasonably been billed.” See Decl. of Gary Greenfield, ECF No. 552 (“Greenfield Decl.”),
§§ 27-37.'4 For example, the Friedman firm billed 3.9 hours on May 28, 2008 and May
13 The Court calculates this 2015 figure for the Friedman firm by adding the reported
hours billed through 2015, as listed in Exhibits 1-3 to the Friedman Declaration. See
Friedman Decl., Exs. 1-3. At oral argument, the Friedman firm argued that Carman only
reported 1,574 hours of work because he failed to keep accurate billing records. There is
no support for this contention in the record. In fact, in an earlier declaration, Carman
confirmed that he billed more time than Friedman. See Decl. of Lynn Carman, ECF No.
431 (“Carman April 2015 Decl.”), § 14. And although Carman initially described
Friedman’s timekeeping as “meticulous,” id. § 13, he subsequently averred that, in several
instances, Friedman’s “so-called ‘contemporary’ time sheet|s]” were “false throughout,”
see Carman Decl. at 8 et seq.
‘4 The Friedman firm moves to strike the Greenfield declaration on grounds that
Greenfield offers inadmissible expert testimony, or, in the alternative, urges the Court to
give Greenfield’s testimony “no weight” because of an alleged conflict of interest. See
generally Pet. Evid. Obj. and Mot. to Strike, ECF No. 556-1. The Court OVERRULES
these objections. The Court finds that the Greenfield declaration is admissible for the same
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
29, 2008 to prepare a two to three page notice of motion accompanying its preliminary
injunction motion. Id. 4 38(b) (citing Ex. 7). That is an unreasonable amount of time for
an attorney to complete a pro forma document that a paralegal could just as easily prepare
in substantially less time.’ In addition, the bulk of Friedman’s reported hours appear to
relate to simply reading e-mails, documents, and filings that Carman prepared and sent to
Friedman. Accord Carman Decl., § 16 (explaining that Friedman’s role “was purely to
read the material I and the opponent sent him . . . and to accompany me to all the courtroom
hearings and settlement negotiations as my second chair or assistant’). These kinds of
“padding in the form of inefficient or duplicative efforts” are “not subject to
compensation.” Ketchum, 24 Cal. 4th at 1132 (citing Serrano III, 20 Cal. 3d at 48).
Second, it appears that the Friedman firm’s reported hours also contain non-
compensable administrative and clerical work. See Davis v. City of San Francisco, 976 F.
2d 1536, 1543 (9th Cir. 1992), vacated on other grounds by 984 F.2d 345 (9th Cir. 1993)
(holding that a party may not recover fees for time spent on purely clerical work) (citing
Missouri v. Jenkins, 491 U.S. 274, 288 n.10 (1989)): accord Christian Research Inst. v.
Alnor, 165 Cal. App. 4th 1315, 1322 (2008) (approving, as a matter of California law, that
a court may deny a fee request for “hours claimed for clerical work”); Ridgeway v. Wal-
Mart Stores Inc., 269 F. Supp. 3d 975, 991 (N.D. Cal. 2017) (deducting from fee award
pursuant to California law because “secretarial or clerical tasks [are] not compensable as
attorneys’ fees”).
For instance, Friedman stated in a sworn declaration submitted at an earlier stage
of this litigation that he billed more than 22 hours on June 1-2, 2008 (“‘1.e., did not go home
— seeing the sun rise from my office”) to prepare PDFs and format other documents for
filings. See ECF No. 470-1, § 16 (stating that Friedman prepared “OCR versions of the
purposes as the Pearl and Gerry declarations submitted by intervenors and petitioners,
respectively. Further, the alleged conflict of interest is unsupported.
Friedman disputes this evidence, and claims that this time included time spent on
the brief in support of the preliminary injunction, not just the notice of motion. However,
the time entries state “Prepare and Draft Notice of Motion for Preliminary Injunction” and
“Review, Finalize, and file Notice of Motion for Preliminary Injunction.” Id., Ex. 7. There
is a Separate time entry addressing revisions and edits to the motion, as well as the notice.
Id.
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
declarations,” “cleaned up” documents, and “prepared summaries and annotations”).
However, in the timesheets submitted along with his instant motion, Friedman
recharacterizes this time performing clerical work as “Review, Revise, Finalize, and file
Declaration,” and “Continue Preparing Declaration.” See ECF No. 548-4. Other time
entries appear to bill other obvious clerical work (i.e. preparing binders) at attorney rates.
See Greenfield Decl., 44. These examples raise doubt as to whether the Friedman firm
included substantial amounts of clerical time in its fee request.
Third, Friedman firm associate Ashton R. Watkins billed 196.40 hours on this case
to “continue monitoring email correspondence and telephone messages [regarding] status
of matter” and “continue facilitating information for” Friedman. See Greenfield Decl.,
{| 48 (discussing these entries). At oral argument, the Friedman firm explained that these
entries referred to time Watkins spent checking Friedman’s e-mail when Friedman was
unable to do so himself. The Court appreciates the importance and need to retain this kind
of auxiliary, but “monitoring” one’s e-mail and voice messages appear to be clerical
functions and the Court finds it should not award attorneys’ fees for this time—and
certainly not at $747/hour. Davis, 976 F. 2d at 1543.
The district court has the authority to “make across-the-board percentage cuts” to a
fee applicant’s “hours claimed” or “final lodestar” figure when a fee application is massive
and unreasonable. Warren v. Kia Motors Am., Inc., 30 Cal. App. 5th 24, 41 (2018) (citing,
inter alia, Gates v. Deukmeyjian, 987 F.2d 1392, 1399 (9th Cir. 1992)). The Court also has
“broad discretion” to “deny” such “an unreasonable fee altogether.” Ketchum, 24 Cal. 4th
at 1138. The Ninth Circuit, for example, recently affirmed a “25% cut to [the lodestar]
hours” reported by a plaintiff's attorney when the cut was supported by a clear explanation
of the district court’s calculation, and a comparison “using a second method of fee
calculation.” Johnson v. MGM Holdings, Inc, 943 F.3d 1239, 1242-43 (9th Cir. 2019).
In this instance, and for the reasons addressed above, the Court finds that a 50%
reduction in the reported hours billed of 8,699 hours is warranted, and that the Friedman
firm’s reasonable lodestar is 4,350 hours. The reasonableness of this number of hours is
confirmed by comparing it with the time reported by other counsel in this matter. For
instance, by an alternative measure, the Court could have appropriately concluded that a
reasonable number of hours for the Friedman firm is 4,402.8 hours. This figure represents
1,574 hours through 2014—which is the number of hours that Carman claimed in his April
23, 2015 fee application through that time, see Carman Fee. Mot. at 1, an appropriate figure
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
given that, even granting credence to Friedman’s claim that he performed “all” of the work
that went into the representation during this time period, it would not be reasonable to
conclude that Friedman’s lodestar exceeds what Carman reported—plus 1,391.2 hours for
2015, 365.5 hours for 2016, 21 hours for 2017, 147.2 hours for 2018, and 903.9 hours for
2019. These hours between 2015 and 2019 represent the number of hours the Friedman
firm reports to have been billed by attorneys Friedman and Bernardino for each of those
years, not including the 29.7 hours billed by their associates Watkins and Pantel (which the
Court addresses above). See Friedman Decl., Ex. A.
Since the 4,350 hour figure reached by assessing a 50% reduction is 98.8% of the
4,402.8 hour figure produced by this alternative reasonable method, the Court finds that
the comparison supports the Court’s finding that 4,350 hours is a reasonable lodestar for
the hours spent by the Friedman firm.
* * * * *
The reasonable lodestar amount for the Friedman firm is accordingly $2,731,800.
This amount reflects the product of the $628/hour rate that the Court found to be a
reasonable lodestar rate for the Friedman firm,!° and the 4,350 hours that the Court found
to be a reasonable lodestar for the total number of hours spent by the Friedman firm
litigating this case.
The reasonableness of this figure is confirmed by a comparison using a second
reasonable method of calculation. For example, the Court could have also awarded the
Friedman firm a lodestar of $2,549,535, which would have reflected $886,162 for work
performed between 2008 and 2014 ($563/hour, for work performed in a supporting role,
multiplied by 1,574 hours), $989,022.10 for work performed between 2015 and 2016
‘© The Court applies the $628/hour rate, and not a combination of that rate and the
lower $566/hour rate that the Court found reasonable for the work performed by the
Friedman firm during Carman’s life, because the Court’s decision to reduce the Friedman
firm’s lodestar number of hours by 50% is intended to account for work performed by the
Friedman firm in a supporting role to Carman. The lodestar amount reached by this method
is approximately the same as the lodestar amount reached using an alternative method that
considers a combination of these rates without applying a 50% reduction to the Friedman
firm’s reported hours.
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES —- GENERAL ‘O’
No. 2:08-CV-03315-CAS(MANx) Date January 24, 2020
Title INDEPENDENT LIVING CENTER OF SOUTHERN CALIFORNIA, ET
AL. V. KENT
($563/hour, for work performed in a supporting role, multiplied by 1,756 hours), and
$674,350.90 for work performed between 2017 and the present ($629/hour, for work
performed in a leading role, multiplied by 1,072.1 hours). The Court’s award of
$2,731,800 is 107.1% of this figure, but sufficiently proximate to indicate that $2,731,800
is a reasonable lodestar amount.
2. Adjustments To Lodestar
The Friedman firm argues that the Court should apply a multiplier of at least 8.0 for
essentially the same reasons that HLB cited in requesting a much lower multiplier of 2.0
to 3.0, limited to time spent on the merits period. Also compare Carman Fee Mot. at 1
(requesting at most a multiplier of 6.0). Specifically, Friedman claims a multiplier of 8.0
is warranted to account for (i) the contingent risk the Fnedman firm assumed by accepting
the case, (11) the public benefit Friedman obtained through the litigation, and □□□□□ the
complexity of the issues involved, and (iv) the allegedly exceptional results Friedman
obtained. See Pet. Br. at 7-25. The State, meanwhile, argues as it did in response to the
intervenors’ motion that any fee award should be dramatically reduced because (1) the
issues in the case were not particularly complex, (11) Friedman’s role was extremely
limited, (111) petitioners obtained only limited relief, and (iv) any fee award would fall upon
and deplete public resources otherwise available to benefit Californians. See State Opp.
Pet. at 12-16.
The Court considers each of these factors pursuant to the authorities cited above, see
supra § IV.A.2, and declines to enhance or reduce the Friedman firm’s reasonable lodestar
amount. The Friedman firm’s supporting role during the merits stage of this case simply
does not support a fee enhancement. And while the Court appreciates the State’s arguments
for a fee reduction for the same reasons discussed above in connection with the intervenors’
motion, the Court declines to apply one here for the same reason it discussed above.
V. CONCLUSION
In accordance with the foregoing, the Court GRANTS the petitioners’ and
intervenors’ motions for attorneys’ fees. Intervenors’ counsel, HLB, shall recover
$4,254,713.88. Petitioners’ counsel, the law offices of Stanley L. Friedman, shall recover
$2,731,800.
IT IS SO ORDERED. 00:00 CMJ