Philip Morris USA Inc. v. Gore

Decision Date10 August 2022
Docket Number4D20-932
Parties PHILIP MORRIS USA INC., Appellant, v. Robert A. GORE, Sr., individually, and as Personal Representative of the Estate of Gloria H. Gore, Appellee.
CourtFlorida District Court of Appeals

344 So.3d 1

Robert A. GORE, Sr., individually, and as Personal Representative of the Estate of Gloria H. Gore, Appellee.

No. 4D20-932

District Court of Appeal of Florida, Fourth District.

[April 13, 2022]
Rehearing Denied August 10, 2022

David M. Menichetti and Geoffrey J. Michael of Arnold & Porter Kaye Scholer LLP, Washington, D.C., and Terri L. Parker of Shook, Hardy & Bacon LLP., Tampa, for appellant.

Andrew A. Harris and Grace Mackey Streicher of Harris Appeals, P.A., Palm Beach Gardens, and Jason L. Odom of Gould, Cooksey, Fennell, P.A., Vero Beach, for appellee.

Klingensmith, J.

Appellant Philip Morris USA, Inc. ("Philip Morris") appeals numerous issues, including a final judgment awarding appellee Robert A. Gore, Sr., ("Gore") as personal representative of the Estate of Gloria H. Gore, $2,515,086.53 in attorney's fees and related expert costs in an Engle progeny action pursuant to a Proposal for Settlement. Gore cross-appeals the trial court's reduction in the attorney's fees and costs awarded from the sums requested. We reverse the attorney's fees award against Philip Morris and remand this matter to the trial court to award a reasonable fee pursuant to Gore's Proposal for Settlement that does not include duplicative amounts which Gore has already been paid or awarded for pursuing the claims against any co-defendants. We affirm on all other issues raised in both the appeal and cross-appeal.

Procedural History

In 2008, Gore filed an Engle progeny action against Philip Morris and R.J. Reynolds Tobacco Company ("Reynolds") for wrongful death damages following the death of his wife. The next year, Gore served proposals for settlement ("PFS 1") on both Philip Morris and Reynolds, offering to resolve all claims in the amount of $250,000.00. These proposals were not accepted. The case proceeded to trial in 2014; however, it resulted in a mistrial. Before the re-trial, Gore again served proposals for settlement ("PFS 2") on both

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defendants. Neither party accepted, and the case went to a second trial.

The jury returned a verdict in favor of Gore, awarding him compensatory damages of $2 million, which the trial court reduced by comparative fault. Philip Morris and Reynolds appealed the judgment, and Gore cross-appealed, arguing the trial court erred by applying comparative fault to reduce his compensatory damages. This Court affirmed on Philip Morris and Reynolds’ appeal but reversed on Gore's cross-appeal. See Philip Morris USA Inc. v. Gore , 238 So. 3d 828 (Fla. 4th DCA 2018). On remand, the trial court entered judgment in favor of Gore for the original jury verdict of $2 million.

After the judgment, Gore moved for an award of attorney's fees and costs pursuant to his two rejected PFSs. He requested over $5.6 million in attorney's fees stemming from over 7,000 hours expended by his legal team. Before the evidentiary hearing on costs and fees, Reynolds settled Gore's attorney's fees claim against them ("Reynolds’ settlement"). Following this settlement, Philip Morris served Gore with discovery to disclose the terms of the Reynolds’ settlement.

Gore and Philip Morris stipulated to the total number of hours Gore's attorneys were entitled to recover, agreeing to 6,266.38 hours. They also stipulated to the hours of a specific attorney, Lester Kaney, agreeing he worked 198.9 hours. At the evidentiary hearing, Gore presented the testimony of six trial attorneys and an attorney's fees expert. He requested $1,100.00 an hour for four attorneys, $750.00 an hour for six other attorneys, and $500.00 for another three. However, on cross-examination, many of Gore's testifying attorneys admitted they typically charged less than the amounts sought.

The trial court awarded Gore $1,964,424.75 in attorney's fees and $69,916.78 in expert costs against Philip Morris, for a total of $2,034,341.53 ("Fees Order"). Although Gore requested the use of current hourly rates to calculate the award, the trial court stated the rates must be "closely in line with rates in the approximate timeframe when the work was performed" and used rates from 2008 to 2015. The trial court also reduced the hourly rates of all of Gore's attorneys based on the affidavits of four of Gore's attorneys who had submitted evidence of reasonable hourly rates in an unrelated Engle progeny case, R.J. Reynolds Tobacco Co. v. Koballa , 5D11-2914, 2012 WL 4052859 (Fla. 5th DCA Sept. 11, 2012), opinion withdrawn , 99 So. 3d 630 (Fla. 5th DCA 2012).

When the trial court issued its Fees Order, Philip Morris moved to apply a setoff of the total fees award in the amount of the Reynolds’ settlement, arguing a setoff was required under sections 46.015 and 768.041, Florida Statutes (2020), to prevent Gore from receiving an unreasonable double recovery. The trial court denied Philip Morris’ motion, finding the setoff statutes did not apply to attorney's fees or costs awarded pursuant to Florida Rule of Civil Procedure 1.442 and Florida's PFS statute, section 768.79, Florida Statutes (2020). The trial court then entered a final judgment on attorney's fees and costs, including prejudgment interest, in the total amount of $2,515,086.53. This appeal and cross-appeal followed.

Application of sections 46.015 and 768.041 to motions to setoff attorney's fees

"Whether the trial court awarded a proper set-off is a pure question of law reviewed de novo , and ‘no deference is given to the judgment of the lower courts.’ " Cornerstone SMR, Inc. v. Bank of Am., N.A. , 163 So. 3d 565, 568 (Fla. 4th DCA 2015) (quoting

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D'Angelo v. Fitzmaurice , 863 So. 2d 311, 314 (Fla. 2003) ). The issue presented is whether a non-settling defendant in a civil action is entitled to reduce an attorney's fees award pursuant to a PFS by the amount previously paid by a settling defendant toward their separate PFS. The trial court denied Phillip Morris such a reduction after analyzing sections 46.015 and 768.041.

Setoffs are generally governed by sections 46.015 and 768.041, both of which require setoffs as to amounts received from a joint tortfeasor. Grobman v. Posey , 863 So. 2d 1230, 1237 (Fla. 4th DCA 2003). "The set-off provision in section 768.041(2) ‘was designed to prevent duplicate or overlapping compensation for identical damages.’ "...

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