Van Skike v. Owcp

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

DAVID VAN SKIKE, 

Petitioner,

v. No. 07-73886

BRB Nos.

DIRECTOR, OFFICE OF WORKERS’

COMPENSATION PROGRAMS; CENEX  06-0904

HARVEST STATES COOPERATIVE; 07-0118

LIBERTY NORTHWEST INSURANCE OPINION

CORP.,

Respondents.



On Petition for Review of an Order of the

Benefits Review Board

Argued and Submitted

November 17, 2008—Portland, Oregon

Filed March 2, 2009

Before: William A. Fletcher and Raymond C. Fisher,

Circuit Judges, and John M. Roll,* District Judge.

Opinion by Judge Roll

*The Honorable John M. Roll, United States District Judge for the Dis-

trict of Arizona, sitting by designation.

2365

2368 VAN SKIKE v. DIRECTOR, OWCP

COUNSEL

Charles Robinowitz, Portland, Oregon; Joshua T. Gillelan II

(argued), Longshore Claimants’ National Law Center, Wash-

ington, D.C., for the petitioners-appellants.

John Dudrey, Williams Fredrickson, LLC, Portland, Oregon,

for the respondents-appellees.

OPINION

ROLL, Chief U.S. District Judge:

This is an appeal from the Benefits Review Board’s

(“BRB”) affirmance of attorney’s fee awards granted by the

Administrative Law Judge (“ALJ”) and the District Director

(“DD”) in a matter arising under the Longshore and Harbor

Workers’ Compensation Act (“LHWCA”), 33 U.S.C. §§ 901-

950. After prevailing on every contested issue on a claim for

hearing loss benefits, David Van Skike’s attorney, Charles

Robinowitz, claimed compensation at a market rate of $350

per hour. The bulk of the litigation on the benefits claim had

occurred before the ALJ, but the DD resolved several issues

in the case as well. After reviewing the evidence submitted by

both parties as to what hourly rate was appropriate, and after

accounting for the applicable attorney-fee regulation, 20

C.F.R. § 702.132(a), the ALJ granted Robinowitz a rate of

VAN SKIKE v. DIRECTOR, OWCP 2369

$250 per hour for his time expended litigating before the ALJ;

based upon the complexity of the issues heard before her, the

DD granted Robinowitz a rate of $235 per hour for his time

expended litigating before the DD. The BRB affirmed both

awards, finding that the ALJ and the DD properly applied

§ 702.132(a) in arriving at their respective hourly rates.

On appeal Van Skike argues that the fee awards were arbi-

trary, capricious, and an abuse of discretion, because both the

ALJ and the DD rejected evidence proffered by Robinowitz

as to his market rate and instead relied upon past LHWCA

awards by other ALJs and DDs in arriving at their determina-

tions. Van Skike further argues that the DD erred in reducing

his market rate for lack of complexity. Finally, Van Skike

argues that the DD erred by not awarding Robinowitz an

enhanced fee for delay in payment. We have jurisdiction

under 33 U.S.C. § 921(c), and we vacate and remand in part,

and affirm in part.

FACTS AND PROCEDURAL HISTORY

Proceedings Before the ALJ

Robinowitz argued that a market rate of $350 per hour was

appropriate given his general experience, his consultation

with a lawyer who testifies as an attorney’s fee expert, various

fee awards he and other attorneys had been granted in the

past, fee agreements he had obtained in non-contingent work,

and the Laffey1 matrix.2 Respondent Cenex objected that the

1

The matrix is derived from the hourly rates allowed by the district

court in Laffey v. Northwest Airlines, Inc., 572 F.Supp. 354 (D.D.C. 1983).

2

More specifically, Robinowitz claimed his normal billing rate was

$350 per hour based upon the following: (1) he had been a trial lawyer in

private practice in Portland, Oregon since 1969, had represented over

1,000 maritime workers under the LHWCA, and had handled over 500

jury and court trials; (2) he consulted with William Crow, a trial attorney

who had testified numerous times as an attorney fee expert, and Crow told

2370 VAN SKIKE v. DIRECTOR, OWCP

rate was incommensurate with the relevant prevailing market

rate, and argued that recent LHWCA awards established that

a figure somewhere between $200 and $235 was appropriate.

Respondent Cenex also cited a number of contemporaneous

LHWCA cases in which Robinowitz had been awarded

between $200 and $250 per hour by ALJs and DDs.

In his Supplemental Decision and Order Granting Attor-

ney’s Fees, issued on July 14, 2006, ALJ William Dorsey

considered and rejected each of Van Skike’s proposed

grounds for a $350 per hour rate.3 The ALJ discussed the per-

him that his hourly rate should be approximately $350 per hour in cases

of this type; (3) in March 2006 the Oregon Court of Appeals awarded him

an hourly rate of $350 per hour in a discrimination case, and in May 2006

the Ninth Circuit awarded him $300 per hour for legal services in Chris-

tensen v. Director, OWCP, Ninth Circuit No. 04-70965; (4) Seattle attor-

ney William Hochberg, an attorney with less LHWCA experience than

Robinowitz, received a $300 per hour fee award from the Ninth Circuit in

2005, and Savannah, Georgia attorney Ralph Lorberbaum, an attorney

with similar LHWCA experience to Robinowitz, received a $300 per hour

fee award for an LHWCA claim in 2003; (5) in late 2005 two clients

retained him at $275 per hour, and in spring 2006 three individual clients

retained him at $300 per hour; (6) the Board had awarded him $250 per

hour in each LHWCA case he handled since 2004; and (7) the Laffey

matrix supported an hourly rate of $400, when adjusted for Portland cost

of living figures.

3

With respect to the attorney fee expert relied upon by Robinowitz, the

ALJ found that the attorney’s statement was essentially hearsay which car-

ried with it no substantial guarantee of trustworthiness, and he further

found little evidence that the alleged expert opinion was based upon a

knowledge of litigating longshore claims. With respect to the $350 per

hour award granted by the Oregon Court of Appeals to Robinowitz, the

ALJ noted that Robinowitz himself admitted that the award was enhanced

for risk of loss, which the Supreme Court outlawed in City of Burlington

v. Dague, 505 U.S. 557 (1992); as to the Ninth Circuit’s $300 per hour

award in Christensen, the ALJ found that as the basis of the award was

not articulated but rather stated summarily, it did not establish a market

rate of $350 per hour for Robinowitz. With respect to Seattle attorney Wil-

liam Hochberg’s $300 per hour award, the ALJ similarly found that, as the

VAN SKIKE v. DIRECTOR, OWCP 2371

tinent law regarding fee litigation, including the lodestar cal-

culation and the regulation pertaining to attorney’s fees in

longshore matters, 20 C.F.R. § 702.132(a). The ALJ con-

cluded that it would be error to award Robinowitz a $350 per

hour fee award, as he had failed to establish a “normal billing

rate” under the regulation. The ALJ concluded that the “best

proxy” for a normal billing rate was $250 per hour, based

upon what other trial judges and the BRB had granted Robi-

nowitz in recent LHWCA cases. It is not clear from the record

whether these cases had been litigated in the Portland area or

elsewhere.

Van Skike filed a timely Motion for Reconsideration, along

with an affidavit and supporting memorandum of law,

basis of the award was not disclosed and the record was not before the

ALJ, that example did not establish a market rate of $350 per hour for

Robinowitz. The ALJ also found that Savannah attorney Ralph Lorber-

baum’s $300 per hour award did not establish a market rate for Robi-

nowitz, because the legal services were performed outside Portland, the

employer in that case, unlike Cenex, failed to prove or even suggest that

a lower rate should have been granted, and furthermore the trial judge in

that case had reduced the hours claimed by Lorberbaum, reasoning that

someone who deserved that rate ought to have completed the tasks more

expeditiously. With respect to the non-contingent fees Robinowitz claimed

he obtained from paying clients, the ALJ found that while those fee agree-

ments “are some evidence of what he can obtain for his services in the

open market,” they still failed to show “whether he billed for a significant

portion of his professional services at those rates, or just a few hours of

his time.” The ALJ concluded that the evidence proffered by Robinowitz

was “too thin” to establish that $350 per hour was his normal billing rate.

With respect to previous awards by the BRB to Robinowitz, the ALJ noted

that no agency adjudicators ever granted him fees approaching $350 per

hour, and found that awards to him up to that point clustered at “the lower

to mid $200s per hour.” Finally, with respect to the Laffey matrix, the ALJ

rejected Van Skike’s proposed method for updating it, noting that the orig-

inal data were never gathered with statistical rigor, and concluded that

even if the matrix were updated, it should properly apply only to the com-

plex federal litigation involved in Laffey, rather than the less complicated

LHWCA claim under discussion.

2372 VAN SKIKE v. DIRECTOR, OWCP

responding to the ALJ’s findings. Robinowitz quantified his

non-contingent billing, included the Morones Survey of 2004,

which showed the average fees charged by commercial litiga-

tors in Portland, and included a copy of the previously cited

Ninth Circuit’s unpublished Christensen order, awarding him

attorney’s fees of $300 per hour. In an August 10, 2006 order,

the ALJ denied the motion, once again concluding that in the

absence of “meaningful proof of what hourly clients pay Mr.

Robinowitz, or of what lawyers who are appropriate compara-

tors charge, the awards judges have made to him in compara-

ble cases” were appropriately consulted to “estimate the

‘normal billing rate’ the regulation looks to.”

Proceedings Before the DD

Robinowitz also applied to the DD, Office of Workers’

Compensation Programs (“OWCP”), for an award which

entailed a $350 rate. Respondent Cenex once again chal-

lenged the hourly rate as inconsistent with the relevant pre-

vailing market rate. DD Karen Staats, after reviewing the

responses and objections, concluded that given the consider-

ations contemplated by § 702.132(a), “there is nothing in this

fee request that justifies a rate of $350.00 for legal services

provided in this claim at the DD level.” The DD noted that

$250 per hour was an appropriate rate for work performed

before the ALJ, but granted Robinowitz only $235 per hour,

based upon what she deemed to be a lack of complexity in the

work Robinowitz performed before her.

Van Skike again filed a timely Motion for Reconsideration,

reiterating many of the same arguments he made before the

ALJ. The DD denied the motion on September 19, 2006, stat-

ing that the fee was approved in accord with the applicable

statutory and regulatory criteria as well as the circumstances

of the case.

VAN SKIKE v. DIRECTOR, OWCP 2373

Proceedings Before the BRB

Van Skike appealed both fee awards to the BRB. The BRB

found that the ALJ “fully addressed the evidence of hourly

rates provided by counsel to establish a customary, commu-

nity market rate, and he provided a rational basis for finding

such evidence insufficient to establish an hourly rate of

$350.” The BRB concluded that Robinowitz “failed to dem-

onstrate either legal error or an abuse of discretion” in the

ALJ’s reliance on recent fee awards to him by other judges

and the BRB in arriving at an hourly rate of $250.4 The BRB

found that the DD “independently based her award of $235

per hour on the regulatory criteria of Section 702.132(a),”

compelling the conclusion that there was no abuse of discre-

tion. Finally, the BRB found that the DD did not err in failing

to address a possible rate enhancement for delay in payment,

as “counsel did not seek an hourly rate enhanced for delay.”

STANDARD OF REVIEW

The decision of the BRB is reviewed for substantial evi-

dence and errors of law. Marine Power & Equipment v. Dept.

of Labor, 203 F.3d 664, 667 (9th Cir. 2000). The ALJ’s find-

ings of fact must be accepted by the BRB unless they are con-

trary to law, irrational, or unsupported by substantial

evidence. Id.; see also Parks v. Newport News Shipbuilding

& Dry Dock Co., 32 BRBS 90 (1998). An appellate court

must conduct an independent review of the administrative

record to determine whether the BRB adhered to this standard

of review. Marine Power, 203 F.3d at 667. A decision by the

BRB is supported by substantial evidence if there exists “such

relevant evidence as a reasonable mind might accept as ade-

4

The BRB cited with approval Newport News Shipbuilding & Dry Dock

Co. v. Brown, 376 F.3d 245, 251 (4th Cir. 2004), for the proposition that

“[e]vidence of fee awards in comparable cases is generally sufficient to

establish the prevailing market rates in the relevant community.” (internal

quotation marks and citations omitted) (emphasis added).

2374 VAN SKIKE v. DIRECTOR, OWCP

quate to support a conclusion.” E.P. Paup Co. v. Dir., OWCP,

999 F.2d 1341, 1353 (9th Cir. 1993) (internal quotation marks

omitted). No special deference is accorded to the BRB’s inter-

pretation of the LHWCA, but reasonable interpretations are

respected. Port of Portland v. Dir., OWCP, 932 F.2d 836, 838

(9th Cir. 1991).

DISCUSSION

Exclusive Reliance on Contemporaneous LHWCA Cases to

Set a Market Rate

Van Skike argues on appeal that the ALJ abused his discre-

tion and committed legal error when he rejected in their

entirety the market indicators submitted by Robinowitz and

instead relied on other decisions in previous cases, when the

judges in those previous cases failed to base their fee awards

on market rates. Respondent Cenex contends that the ruling

of the ALJ was predicated upon the applicable regulation,

§ 702.132(a), and that because Van Skike failed to establish

a “normal billing rate,” the ALJ properly relied on hourly rate

decisions in other LHWCA cases.

[1] The Supreme Court has consistently held that reason-

able fees “are to be calculated according to the prevailing

market rates in the relevant community, regardless of whether

plaintiff is represented by private or nonprofit counsel.” Blum

v. Stenson, 465 U.S. 886, 895 (1984). The burden is on the fee

applicant himself “to produce satisfactory evidence” of the

relevant market rate. Id. at 896 n.11. Case law construing rea-

sonable fees “applies uniformly” to fee-shifting statutes such

as the LHWCA, City of Burlington v. Dague, 505 U.S. 557,

562 (1992), and, as with other federal fee-shifting statutes, the

use of the lodestar method (number of hours reasonably

expended multiplied by reasonable hourly rate) in calculating

attorney’s fees under the LHWCA is proper. See Tahara v.

Matson Terminals, Inc., 511 F.3d 950, 955 (9th Cir. 2007).

VAN SKIKE v. DIRECTOR, OWCP 2375

[2] The relevant community is generally defined as “the

forum in which the district court sits.” Barjon v. Dalton, 132

F.3d 496, 500 (9th Cir. 1997). In Christensen v. Price, Ninth

Circuit No. 07-70297, filed today, we note the problems

inherent in narrowly defining the relevant community in

LHWCA cases strictly in terms of what other ALJs, DDs, and

the BRB have awarded fee claimants in contemporaneous

cases. In doing so we reject the Fourth Circuit’s overly cir-

cumscribed definition of “relevant community” advanced in

Brown, relied upon by the BRB in the instant case in affirm-

ing the awards granted by the ALJ and the DD. First, exclu-

sive reliance on contemporaneous LHWCA cases does not

constitute an appropriate determination of a market rate as

contemplated by relevant case law. In Moreno v. City of Sac-

ramento, 534 F.3d 1106, 1115 (9th Cir. 2008), this court

recently found unreasonable a district court’s award of attor-

ney’s fees pursuant to 42 U.S.C. § 1988, because the district

court had applied “what appear[ed] to be a de facto policy of

awarding a rate of $250 an hour to civil rights cases.” Such

a policy ignores current market conditions while deferring to

historical market rates, which is clearly not contemplated by

Blum. Exclusive reliance on contemporaneous LHWCA cases

also overlooks the fact that LHWCA attorneys are forbidden

by law from, and face criminal penalties for, negotiating or

entering into private fee agreements with their clients. See 33

U.S.C. § 928(e). The lack of a private LHWCA market does

not absolve courts of the duty to arrive at a market rate. As

we note today in Christensen, the relevant community must

necessarily be defined more broadly than the LHWCA bar.

Finally, exclusive reliance on contemporaneous LHWCA

cases is contrary to the rationale behind fee-shifting statutes

in general. In Camacho v. Bridgeport Financial, Inc., in

which an attorney’s fee award in a Fair Debt Collection Prac-

tices Act (“FDCPA”) case was vacated because the district

court failed to make findings regarding what constituted the

relevant community or an appropriate market rate, we reiter-

ated that “[i]n order to encourage able counsel to undertake

FDCPA cases, as congress intended, it is necessary that coun-

2376 VAN SKIKE v. DIRECTOR, OWCP

sel be awarded fees commensurate with those which they

could obtain by taking other types of cases.” 523 F.3d 973,

981 (9th Cir. 2008) (internal quotation marks omitted and

alteration in original). Arbitrarily holding the line at past

court-generated fee awards does not respect the congressional

intent animating fee-shifting statutes. See Student Pub. Inter-

est Research Group of N.J. v. AT&T Bell Labs., 842 F.2d

1436, 1446 (3d Cir. 1988) (“Courts that try to establish public

interest market rates by looking to the going rate for public

interest work therefore do not examine an independently oper-

ating market governed by supply and demand, but rather

recast fee awards made by previous courts into ‘market’ rates

. . . [thereby] . . . perpetuat[ing] a court-established rate as a

‘market’ when that rate in fact bears no necessary relationship

to the underlying purpose of relying on the marketplace: to

calculate a reasonable fee sufficient to attract competent coun-

sel.”).

[3] As stated in Christensen, the same concerns expressed

in Camacho and Moreno as to other fee-shifting cases apply

with equal force to LHWCA cases. It is true that the remand

for the fee determinations in Christensen occurred largely

because the BRB did not adequately justify its awards. The

instant case is distinguishable from Christensen in that both

the ALJ and the DD here provided, for the most part, detailed

analyses of the evidence proffered by Van Skike to establish

a prevailing market rate. The exclusive reliance by the ALJ

and the DD on contemporaneous LHWCA cases remains

problematic, however, given the guidance of Camacho,

Moreno, and now Christensen. The relevant community must

be defined “more broadly than simply fee awards under the

LHWCA.” Christensen, Ninth Circuit No. 07-70297 at 9.

Finally, Christensen states that the failure of a fee applicant

to carry his burden under Blum as to the establishment of a

relevant market may justify courts in looking to what other

ALJs and the BRB have awarded a fee applicant in contempo-

raneous LHWCA cases, but it also states that if the reasons

given by a court for such a failure “would not have been

VAN SKIKE v. DIRECTOR, OWCP 2377

anticipated by a reasonable fee applicant,” “it may be appro-

priate . . . to allow an applicant to cure its failure to carry the

burden.” Id. at 10.

[4] Under the circumstances presented by this case, particu-

larly considering the detailed justification proffered by Van

Skike to establish a relevant market rate, it is appropriate to

vacate the fee awards arrived at by the ALJ and the DD and

to remand the case for reconsideration of Van Skike’s pro-

posed rate in light of the guidance provided by Christensen

and this opinion. The ALJ and the DD may then decide

whether it is proper to award a different fee or to allow Van

Skike to modify his fee request in an attempt to cure what

they originally deemed a failure to establish a market rate.

Reduction of Hourly Rate Based Upon Complexity of Task

Van Skike argues on appeal that the DD committed legal

error when she awarded a lower hourly rate than the ALJ due

to what she deemed to be a lack of complexity of the issues

heard before her. He argues that such a practice is inconsistent

with all other fee-shifting regimes Congress has authorized

and further contends that Blum forbids the DD from consider-

ing the complexity of the legal issues involved in computing

an hourly rate, as opposed to considering that factor in com-

puting the number of hours allowed. Respondent Cenex con-

tends that the DD properly applied § 702.132(a) and that the

BRB properly affirmed her fee determination.

[5] Attorney’s fee awards under the LHWCA are to be

“reasonably commensurate with the necessary work done and

shall take into account the quality of the representation, the

complexity of the legal issues involved, and the amount of

benefits awarded.” 20 C.F.R. § 702.132(a). While the regula-

tion does not expressly mandate the use of the traditional

lodestar method, it does permit the consideration of lodestar

factors not explicitly listed, and it also sets forth at least four

of the eleven factors to be considered. See Van Gerwen v.

2378 VAN SKIKE v. DIRECTOR, OWCP

Guarantee Mutual Life Co., 214 F.3d 1041, 1045 n.2 (9th Cir.

2000) (listing the lodestar factors). The Supreme Court has

stated that the lodestar is the “guiding light” of its fee-shifting

jurisprudence, a standard that is the fundamental starting point

in determining a reasonable attorney’s fee. Dague, 505 U.S.

at 562. Moreover, in the instant case the DD used the lodestar

method in calculating the fee award. In doing so, however,

she deviated from the admonition that the reasonable hourly

rate is generally determined based upon the prevailing rate in

the relevant community, rather than upon the complexity of

the issues, which should be reflected in the reasonable number

of hours. See Blum, 465 U.S. at 895. Here, as in Blum, the

“novelty and complexity of the issues presumably were fully

reflected in the number of billable hours recorded by coun-

sel.” Id. at 898. Therefore, “[n]either complexity nor novelty

of the issues . . . is an appropriate factor in determining

whether to [decrease] the basic fee award.” Id. at 898-99.5

[6] A formulaic recitation of the regulations pertaining to

LHWCA fee awards is insufficient to absolve the DD from

compliance with relevant case law outlining the lodestar

methodology. Reducing an hourly rate based upon a lack of

complexity and the routine nature of the work is inconsistent

with other fee-shifting regimes Congress has adopted or the

Supreme Court has approved. 20 C.F.R. § 702.132 does not

specifically require that the reasonable rate determination turn

upon the complexity of the issues, so it was incumbent upon

the DD to consistently apply the prevailing lodestar methodol-

ogy, which accounts for complexity in the hours and not in

the rate computation. It is appropriate, therefore, to vacate the

DD’s determination to reduce the fee award based upon lack

of complexity and to remand to her so that she can recalculate

the award in light of the foregoing guidance.

5

It would be illogical and burdensome under any fee-shifting statute, for

instance, to attempt to distinguish between an attorney’s hourly rate for a

15-minute phone call with the clerk’s office concerning a technical proce-

dural issue and a 15-minute phone call with a client providing expert sub-

stantive advice based on how the procedural issue was resolved.

VAN SKIKE v. DIRECTOR, OWCP 2379

Delay Enhancement

Van Skike argues on appeal that the DD committed legal

error when she failed to enhance the fee award to Robinowitz

for delay in payment. Respondent Cenex contends that since

Van Skike did not raise this issue before the DD, it is not

reviewable by the panel.

[7] A review of the administrative record reveals that Van

Skike never raised the delay enhancement argument either in

his initial application for fees to the DD or in his motion for

reconsideration. He did eventually brief the issue to the BRB,

but the BRB declined to consider it because it found he raised

it for the first time on appeal. Van Skike contends in his

Reply Brief that his mere request for a $350 per hour current

market rate was sufficient not only to raise the delay issue but

to preserve it on appeal. It is clear from the fee affidavit and

from the orders drafted by both the ALJ and the DD that the

common issue under consideration was not delay but whether

Robinowitz’s $350 per hour request represented his normal

billing rate or the current prevailing market rate. Because Van

Skike never effectively raised the prospect of delay, the BRB

was not required to reach the issue. See Johnson v. Dir.,

OWCP, 183 F.3d 1169, 1171 (9th Cir. 1999) (holding in

LHWCA case that, unless necessary to prevent manifest

injustice, Ninth Circuit will not review issue not raised

below); Smiley v. Dir., OWCP, 984 F.2d 278, 281 (9th Cir.

1992) (stating that Ninth Circuit will reach an issue of law of

which the ALJ and the BRB were aware and which BRB

promised to consider; reaffirming that the standard for

whether issue was properly raised below is that argument

must be sufficient for trial court to rule on it); Perkins v.

Marine Terminals Corp., 673 F.2d 1097, 1100 (9th Cir. 1982)

(holding that BRB lacked authority to raise LHWCA cover-

age issue sua sponte when issue was not previously raised

before ALJ). The BRB’s decision was therefore proper, given

the factual circumstances and the applicable law.

2380 VAN SKIKE v. DIRECTOR, OWCP

AFFIRMED IN PART, VACATED AND REMANDED

IN PART. Each party shall bear its own costs on appeal.