E. Associated Coal Corp. v. Dir., Office of Workers' Comp. Programs

• Citation: 724 F.3d 561
• Decision Date: 31 July 2013
• Docket Number: Nos. 11–2038,11–2380.,s. 11–2038
• Parties: EASTERN ASSOCIATED COAL CORPORATION, Petitioner, v. DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS; Harold Gosnell, Respondents. Eastern Associated Coal Corporation, LLC, Petitioner, v. Director, Office of Workers' Compensation Programs, United States Department of Labor; Harold Gosnell, Respondents.
• Court: United States Courts of Appeals. United States Court of Appeals (4th Circuit)

724 F.3d 561

EASTERN ASSOCIATED COAL CORPORATION, Petitioner,

v.DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS; Harold Gosnell, Respondents.

Eastern Associated Coal Corporation, LLC, Petitioner,

v.Director, Office of Workers' Compensation Programs, United States Department of Labor; Harold Gosnell, Respondents.

Nos. 11–2038, 11–2380.

United States Court of Appeals,Fourth Circuit.

Argued: May 14, 2013.

Decided: July 31, 2013.

ARGUED:Laura Metcoff Klaus, Greenberg Traurig LLP, Washington, D.C., for Petitioner. Ryan Christopher Gilligan, Wolfe, Williams, Rutherford & Reynolds, Norton, Virginia, for Respondents. ON BRIEF:Mark E. Solomons, Greenberg Traurig LLP, Washington, D.C., for Petitioner. Joseph E. Wolfe, Wolfe, Williams, Rutherford & Reynolds, Norton, Virginia, for Respondents.

Before WILKINSON, GREGORY, and KEENAN, Circuit Judges.

Affirmed as modified by published opinion. Judge KEENAN wrote the opinion, in which Judge WILKINSON and Judge GREGORY joined.

BARBARA MILANO KEENAN, Circuit Judge:

In this appeal, we consider a former employer's challenges to attorneys' fees and other related fees awarded under the Black Lung Benefits Act (the BLBA), 30 U.S.C. §§ 901 through 945. After Harold Gosnell, the claimant, was awarded black lung benefits, claimant's counsel successfully petitioned the administrative law judge (the ALJ) for an award of recoverable fees. The Benefits Review Board (the BRB) affirmed the ALJ's fee award and also awarded certain fees for additional work performed before the BRB.

We consider the issue whether the awards of attorneys' fees properly reflected market-based evidence of counsel's hourly rate, as required by the lodestar analysis in Hensley v. Eckerhart, 461 U.S. 424, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983). We also address whether the practice of quarter-hour billing by claimant's counsel resulted in an excessive number of hours billed in this case. Upon our review, we hold that neither the ALJ nor the BRB abused its discretion in concluding that counsel provided sufficient market-based evidence of rates, and that the number of hours billed for attorneys' services reasonably reflected the work completed. However, we further hold that the award of fees for work performed by certain legal assistants was not supported fully by the record, and we modify that award accordingly. We therefore affirm the attorneys' fee awards entered in this case, and modify the fees awarded for legal assistant services.

I.

In 2005, the claimant filed a claim for benefits under the BLBA against his former employer, Eastern Associated Coal Corporation (Eastern). The claimant, who was a coal miner for seventeen years, had developed a mass on his right lung that required medical treatment. The medical evidence introduced in this proceeding addressed the issue whether the claimant suffered from “unilateral” complicated coal workers' pneumoconiosis, i.e., black lung disease affecting only one lung. Among other evidence bearing on the question, the two radiologists who offered expert testimony reached contrary conclusions on this unusual issue. Dr. William Scott explainedthat the incidence of pneumoconiosis in only one lung would be “incredibly atypical,” and concluded that the mass in the claimant's right lung was not pneumoconiosis but rather likely resulted from an infection. Dr. Kathleen DePonte agreed that in the “classic” case, pneumoconiosis would affect both lungs, but she nevertheless opined that the claimant suffered from complicated coal workers' pneumoconiosis.

In 2010, the ALJ found that the claimant suffered from complicated coal workers' pneumoconiosis and awarded him benefits under the BLBA. The benefits award is not at issue in this case.

The law firm representing the claimant, Wolfe, Williams, Rutherford & Reynolds (claimant's counsel), later filed a petition for attorneys' fees, seeking $35,953.75 for work relating to the proceedings before the ALJ. ¹ In support of the petition, claimant's counsel stated the years of experience and the hourly rates of the various attorneys who had worked on the case. The petition represented that Joseph Wolfe had over thirty years' experience and charged $300 per hour for his services; that Bobby Belcher had sixteen years' experience and charged $250 per hour; and that W. Andrew Delph and Ryan Gilligan each had several years' experience and charged $200 and $175 per hour, respectively.

Claimant's counsel stated that it knew of “no other firms in Virginia and very few across the nation” that accept new black lung cases. Counsel further represented that black lung claimants ultimately are awarded benefits in only five percent of cases.

Of central importance to this appeal, claimant's counsel also submitted for the ALJ's consideration a list of twenty-one prior fee awards issued in black lung cases handled by claimant's counsel. These awards had been made by seven different ALJs, all within several years of the present fee awards.

Claimant's counsel also submitted to the ALJ the Altman Weil Survey of Law Firm Economics (2006) (the Altman Weil Survey), which showed hourly rates for attorneys with varying degrees of experience in the “South Atlantic” and “Middle Atlantic” regions. Claimant's counsel additionally attached an itemized billing statement describing work done for the claimant in proceedings before the ALJ between February 2007 and March 2010.

In the petition, claimant's counsel similarly sought fees for work done by certain legal assistants at an hourly rate of $100. Claimant's counsel stated that $100 per hour was the firm's “customary billing rate” for legal assistants in black lung cases. But significantly, counsel did not provide any information regarding market rates for legal assistants, either in its list of prior fee awards or in the excerpt submitted from the Altman Weil Survey.

In October 2010, the ALJ issued an award of attorneys' fees to claimant's counsel. The ALJ first considered the hourly rates requested by claimant's counsel, and found that there was sufficient evidence submitted of reasonable, prevailing hourly rates based on “multiple and consistent awards by diverse judges” over the previous four years. The ALJ found that the hourly rates listed in the Altman Weil Survey for the South Atlantic region also supported the hourly rates sought, given the nature of counsel's practice representing “black lung claimants [ ] over a broad region in Virginia and West Virginia.”The ALJ additionally found that the hourly rate requested for work performed by legal assistants was appropriate. Accordingly, the ALJ approved the hourly rates requested.

Next, the ALJ considered whether the billed amount of 168.95 hours was reasonable. The ALJ disagreed with Eastern's argument that claimant's counsel necessarily had billed an excessive amount by using a quarter-hour billing system. The ALJ explained that quarter-hour billing was permitted under 20 C.F.R. § 802.203(d)(3) and, thus, that the use of such billing increments was not unreasonable per se. After examining the billing statement submitted by claimant's counsel, the ALJ disallowed various charges for clerical tasks and several other charges for tasks that were found to be either duplicative or unnecessary. In all, the ALJ reduced the number of billed hours by about thirty, and awarded claimant's counsel $31,628.75 in attorneys' fees rather than the amount of $35,953.75 originally sought. The amount awarded by the ALJ included $3,675 for work performed by legal assistants. On review, the BRB affirmed the ALJ's award of attorneys' fees, concluding that the ALJ did not abuse his discretion either with respect to the hourly rates or to the number of hours awarded.

Claimant's counsel filed an additional fee petition to the BRB, seeking $3,675 for work performed primarily by attorneys Wolfe and Gilligan during the claimant's appeal. The supporting documentation incorporated the information presented in the attorneys' fees petition to the ALJ, including citation to the twenty-one prior fee awards, a description of the experience of claimant's counsel, and portions of the Altman Weil Survey. The primary difference in the submission to the BRB was that claimant's counsel requested an hourly rate of $225 for Gilligan, rather than the $175 rate used in the petition before the ALJ. Claimant's counsel also sought compensation for work performed by legal assistants at an hourly rate of $100.

In October 2011, the BRB granted the petition in part. The BRB determined that the prevailing market rate for Wolfe was $300 per hour, but concluded that Gilligan's market rate was only $175 per hour based on two prior fee awards. ² The BRB also approved an hourly rate of $100 for legal assistants. After making adjustments to the number of hours reasonably expended, the BRB awarded claimant's counsel $2,950 in attorneys' fees. This total amount awarded by the BRB included $125 for services performed by a legal assistant.

Eastern timely filed appeals seeking review of the fee awards issued by the ALJ and the BRB (the agency adjudicators). Those appeals were consolidated in this Court.

II.

Eastern raises two challenges to the fee awards: (1) that claimant's counsel did not provide sufficient market-based evidence of an hourly rate, which was necessary for calculation of an applicable lodestar figure; and (2) that claimant's counsel requested an excessive number of hours as a result of its practice of quarter-hour billing. Eastern asks that we vacate the fee awards and remand for fee determinations reflecting “only reasonable hours at a market rate.”

Before turning to address Eastern's arguments, we first discuss the legal framework governing awards of attorneys' fees under the BLBA. We review for abuse of discretion an award of attorneys' fees made under the BLBA, whether determined by an ALJ or by the BRB. Kerns v. Consol. Coal Co., 176 F.3d 802, 804 (4th Cir.1999). An ALJ and the BRB are afforded wide...