Pickett v. Cheesecake Factory Rests., Inc.

• Decision Date: 31 August 2016
• Docket Number: NO. CAAP-15-0000593,CAAP-15-0000593
• Citation: 383 P.3d 138 (Table),139 Hawai'i 35
• Parties: Marisa K. Pickett, Claimant–Appellee/Appellant, v. Cheesecake Factory Restaurants, Inc., Employer–Appellant/Appellee, and American Zurich Insurance Company, Insurance Carrier–Appellant/Appellee, and Gallagher Bassett Services, Inc., Insurance Adjuster–Appellant/Appellee
• Court: Hawaii Court of Appeals

139 Hawai'i 35
383 P.3d 138 (Table)

Marisa K. Pickett, Claimant–Appellee/Appellant,
v.
Cheesecake Factory Restaurants, Inc., Employer–Appellant/Appellee,
and
American Zurich Insurance Company, Insurance Carrier–Appellant/Appellee,
and
Gallagher Bassett Services, Inc., Insurance Adjuster–Appellant/Appellee

NO. CAAP-15-0000593

Intermediate Court of Appeals of Hawai'i.

DATED: Honolulu, Hawai‘i, August 31, 2016.

On the briefs:

Stanford H. Masui, Erin B.J.H. Masui (Law Offices of Masui–Masui), Honolulu, for Claimant–Appellee/Appellant.

Jennifer M. Yusi Lisa Strandtman (Rush Moore), Honolulu, for Employer–Appellant/Appellee, Insurance Carrier-Appellant/Appellee, and Insurance Adjuster–Appellant/Appellee.

(By: Nakamura, C.J., Foley and Leonard, JJ.)

MEMORANDUM OPINION

Claimant-Appellee/Appellant Marisa K. Pickett (Pickett ) appeals from the “Decision and Order” entered on July 27, 2015 by the Labor and Industrial Relations Appeals Board (LIRAB ).

On appeal, Pickett contends the LIRAB erred in: (1) reducing her requested attorney's fees based on an hourly rate of $165 per hour; and (2) considering qualitative factors based on the subjective experience of LIRAB members in upholding the reduction.

I. BACKGROUND

Pickett began working for Employer-Appellant/Appellee Hawaii Cheesecake Factory Restaurants Inc. (Employer ) on September 30, 2010. On March 12, 2011, Pickett sustained a an injury while working, for which she filed a workers' compensation claim.

The Disability Compensation Division of the Department of Labor and Industrial Relations (DCD ) issued a decision compensating Pickett for her injuries on April 14, 2014. Employer appealed from the decision to the LIRAB on May 2, 2014.

On May 20, 2014, Employer filed a notice of deposition for Pickett, which was scheduled to take place on January 16, 2015. Employer took the oral deposition of Pickett and agreed to pay for Pickett's attorney's fees and costs associated with the deposition, but no agreement was reached as to the billable hourly rate for Pickett's attorney.

By letter dated January 21, 2015, Stanford H. Masui (Masui ), counsel for Pickett, submitted to the LIRAB a “Request for Approval of Attorney's Fee” at the hourly rate of $210 for 10.5 hours of work. Masui stated that he had thirty years of experience in workers' compensation cases, participated in over one hundred cases before the DCD over the last three years, and participated in approximately fifty cases before the LIRAB over the last three years. The request also listed Erin Masui as an attorney for Pickett, and described her as having two years of experience in workers' compensation cases, participating in about thirty cases before the DCD over the last three years, and participating in approximately ten cases before the LIRAB over the last three years.

Employer submitted an objection to Masui's request for attorney's fees on February 2, 2015. Employer objected to Masui's requested rate of $210 per hour as “excessive.” Employer reasoned, “[t]his is especially so since his hourly rate reflected in his prior Request for Approval of Attorney's Fee submitted to the [DCD] dated 3/25/14 in this very same case is $160.” Aside from Masui's earlier request for fees, Employer provided no other documentation or evidence relevant to its objection to Masui's requested hourly rate.

On February 5, 2015, the LIRAB granted Masui's request for attorney's fees at the reduced hourly rate of $165. In its “Attorney's Fee Approval and Order,” the LIRAB stated:

4. In reviewing the subject fee request the [LIRAB] took into account the benefits obtained for [Pickett] in this appeal, the novelty and difficulty of issues involved on appeal, the amount of fees awarded in similar appeals, and the hourly rate customarily awarded workers' compensation attorneys possessing similar skills and experience, including [Masui's] years of practice in the field of workers' compensation law, the number of clients represented before the [LIRAB], as well as [Masui's] responsiveness and timeliness.

5. In this case, the [LIRAB] does not approve the requested attorney hourly rate of $210.00. An hourly rate of $165.00 for [Masui] is reasonable and is consistent with that customarily awarded to attorneys possessing similar skills and experience before the [LIRAB].

6. [Masui] has practiced in the field of workers' compensation law in Hawaii for approximately 30 years.

7. In the past three years, [Masui] has represented approximately 100 clients before the [DCD] and approximately 50 clients before the [LIRAB].

8. 10.50 hours were reasonably required to address the complexities of the issues involved on appeal.

9. Costs in the amount of $21.00 are reasonable.

10. The total amount of $1,835.14, including fees and costs, is reasonable.

On March 9, 2015, Masui submitted a motion for reconsideration of the LIRAB's order approving the attorney's fee at a reduced hourly rate. Masui attached a declaration stating the basis for his requested rate of $210 per hour. Masui declared:

6. The basis for the hourly fee rate of $210, was the result of a meeting held on Dec. 22, 2014 of [sic] the Director of Labor and Industrial Relations, Dwight Takamine, who extended the meeting invitation to claimants' attorneys who handle a “substantial number of workers' compensation cases”. Among the concerns discussed was to “ensure adequate access to legal assistance for claimants”.

7. Mr. Takamine announced a new fee schedule to be implemented no later than Jan. 1, 2015 for all work going forward, without the need to submit additional request forms. The attorneys were specifically advised that they may bill at the rates indicated based on years of experience, and if questions arose as to other factors (such as the statutory criteria), the DCD would request further information or clarification. It is my information that several attorneys have received fee approvals from the DCD based on the new schedule.

8. I have been licensed since 1976, and have been engaged in private practice since 1982. The first private law firm I was employed was [sic] with Gary Galiher and Associates, whose practice involved accident cases and asbestos litigation. The asbestos litigation involved hundreds of clients, including class action mass torts. Virtually all cases [were] workers' compensation companion cases involving asbestos exposure. Many of the cases involved federal workers' compensation, but also State of Hawaii cases for many who were employed in private shipyards, boiler, and automotive repair companies.

9. I carried a caseload of about 200 cases at all times at that firm. My subsequent private employment with Takahashi, Masui, and Vasconcellos, as the chairman is aware, also required a caseload of 100-200 workers' compensation cases at all times. My subsequent solo practice has continued to involve 100-150 workers' compensation cases at all times. It is safe to say that I have represented thousands of injured workers in the last thirty years.

10. The most recent “raise” in the hourly rate for myself was in 2012 to a rate of $160 per hour. The previous approved rate was $155 per hour which was allowed in 2006. The increased rate of increase to $160 and hour from 2006 to 2012 was therefore less than a $1.00 per year.

11. An increase in approved hourly rate to $210 in 2015 represents an increase of only $15 per year, from 2012 to 2015.

12. I have been approved by the courts at the rate of $325 for civil cases and recently billed a deposition at $325, which was accepted by the defense attorney. Based on information and belief, attorneys in private litigation practices in Honolulu are presently charging at the rate of $300–400+ per hour (see Memorandum of Law submitted with this Declaration).

13. I have previously submitted a letter to the [LIRAB] urging a review of the allowable fee rates, which have in past practice followed the DCD, by adding an additional $5.00 per hour, which is an arbitrary method. Since the number of appeals and the type of issues both substantive and procedural have become more complex and esoteric the hourly fee basis should also require a wholesale review and upgrading by the [LIRAB]. Additionally, the [LIRAB] may continue to review attorney fee request for reasonableness under sec. 386-94 [Hawaii Revised Statutes (HRS) ] regardless of the hourly rate charged.

....

15. It is my understanding and belief that most civil litigation attorneys will not accept workers' compensation cases due to the complexity, frustration, and low hourly rates. It is also common knowledge

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