UNITED STATES DISTRICT COURT

DISTRICT OF NEW JERSEY

___________________________________

UNITED STATES OF AMERICA ex rel. |

STEVEN S. SIMRING, M.D. |

|

Plaintiffs, |

|

vs. |

| Civil Action

UNIVERSITY PHYSICIAN ASSOCIATES, | No. 4-3530 (PGS)

UNIVERSITY OF MEDICINE AND DENTISRY|

UMDNJ-UNIVERSITY HOSPITAL, UMDNJ- |

NEW JERSEY MEDICAL SCHOOL, et al., |

|

Defendants. |

___________________________________|

DEFENDANT UNIVERSITY OF MEDICINE AND DENTISRY OF NEW JERSEY’S

BRIEF IN OPPOSITION TO PLAINTIFF’S MOTION FOR ATTORNEYS’ FEES

AND EXPENSES

McElroy, Deutsch, Mulvaney &

Carptenter, LLP

1300 Mt. Kemble Avenue

P.O. Box 2075

Morristown, NJ 07962

Attorneys for Defendant

Of Counsel:

Walter F. Timpone

On the brief:

Robert C. Scrivo

Kristoffer S. Burfitt

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TABLE OF CONTENTS

TABLE OF CONTENTS i

TABLE OF AUTHORITIES iii

PRELIMINARY STATEMENT 1

BACKGROUND 5

LEGAL ARGUMENT 6

I. RELATOR’S FEE REQUEST SUBSTANTIALLY

EXCEEDS THE MARKET RATE IN NEW JERSEY AND

INCLUDES AN UNREASONABLE NUMBER OF

BILLABLE HOURS THAT SHOULD BE REDUCED BY

THE COURT TO REFLECT A REASONABLE LODESTAR 6

A. Relator’s Counsel’s Requested Fee Rates

Substantially Exceed the Market Rate in

New Jersey 9

1. Litman Should be Granted a Reasonable

Market Rate in Line With Attorneys of

Similar Experience and Skill in New

Jersey 11

2. Furst Should be Granted a Market Rate

in Line with Solo Practitioners of

Similar Skill and Experience in New

Jersey 15

3. Both Attorneys’ Rates Should be Reduced

for Time Spent Performing Legal

Research 16

B. Relator’s Counsel Seek Payment For an

Unreasonable Number of Hours Expended on

This Case 18

1. Relator’s Counsel’s Excessive,

Redundant and Vague Billing Entries are

Non-Recoverable 20

2. Relator’s Counsel’s Billing Entries for

Research are Excessive 23

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3. Relator’s Counsel’s Billing Entries

that Bear No Relationship to the Qui

Tam Case are Not Recoverable 26

4. Hours Devoted by Relator’s Counsel to

the Recovery of the “Relator’s Share”

is Non-Compensable 28

5. Relator’s Counsel’s Time Searching for

Expert Witnesses May Not Be Recovered 30

6. Relator’s Counsel’s May Not Be

Recompensed For Duplicative Time

Entries 31

7. Hours Billed Following Settlement on

June 19, 2009 Must Be Excluded,

Including Fees Stemming from this Fee

Dispute 31

C. Calculation of the Lodestar 33

II. NO ENHANCEMENT SHOULD BE APPLIED TO THE

LODESTAR BECAUSE RELATOR HAS FAILED TO

SATISFY THE CRITERIA SET FORTH BY THE

SUPREME COURT TO ESTABLISH SUCH A

MULTIPLIER 34

A. Relator’s Counsel Cannot Satisfy the

Requirements set by the Supreme Court for

Upward Modification 35

III. EXPENSES ARE NOT INCLUDED IN THE LODESTAR

AND THE EXPENSES SUBMITTED BY FURST ARE

INAPPROPRIATE AND NOT RECOVERABLE 38

CONCLUSION 40

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TABLE OF AUTHORITIES

Supreme Court Cases

Blum v. Stenson,

465 U.S. 886 (1984) 7, 10, 14, 38

Hall v. Cole,

412 U.S. 1 (1973) 8

Hensley v. Eckerhart,

461 U.S. 424 (1983) passim

Missouri v. Jenkins,

491 U.S. 274 (1989) 36

Purdue v. Kenny A. ex rel. Winn,

__ U.S. __, 130 S.Ct. 1662 (2010) 25

VT Agency of Natural Res. v. United States ex rel. Stevens,

529 U.S. 765 (2000) 24

Circuit Court Cases

Copeland v. Marshall,

641 F.2d 880 (D.C. Cir. 1980) 8, 19

In re Fine Paper Antitrust Litigation,

751 F.2d 562 (3d Cir. 1984) 16

In re Olsen,

884 F.2d 1415 (D.C. Cir. Spec. Div. 1989) 21

Institutionalized Juveniles v. Sec. of Pub. Welfare,

758 F.2d 897 (3d Cir. 1985) 19

Interfaith Cmty. Org. v. Honeywell Int’l Inc.,

426 F.3d 694 (3d Cir. 2005) 14, 18, 19, 30

Lanni v. New Jersey,

259 F.3d 146 (3d Cir. 2001) 7, 8, 9, 26

Maldonado v. Houstoun,

256 F.3d 181 (3d Cir. 2001) 9

Planned Parenthood of Cent. N.J. v. Attorney General of N.J.,

297 F.3d 253 (3d Cir. 2002) 25, 26

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Pub. Interest Research Group of N.J. v. Windall,

51 F.3d 1179 (3d Cir. 1995) 10, 19

Rode v. Dellarciprete,

892 F.2d 1177 (3d Cir. 1990) passim

Smith v. Philadelphia Hous. Auth.,

107 F.3d 223 (3d Cir. 1997) 7

Student Pub. Interest Research Group v. AT&T Bell Labs,

842 F.2d 1436 (3d Cir. 1988) 7, 10, 36

Student Pub. Interest Research Group v. Monsanto Co.,

721 F. Supp. 604 (D.N.J. 1989) 10

United States ex rel. Barajas v. Northrup Grumman Corp.,

258 F.3d 1004 (9th Cir. 2001) 24

United States ex rel. Taxpayers Against Fraud v. Gen. Elec. Co.,

41 F.3d 1032 (6th Cir. 1995) 29

District Court Cases

Apple Corp. v. Int’l Collectors Soc’y,

25 F. Supp. 2d 480, 484-85 (D.N.J. 1998) 19, 20, 26

Barrett v. West Chester Univ. of Pa. of the State Sys. Of Higher

Educ.,

No. 03-CV-4978,

2006 WL 859714 (E.D.Pa. Mar. 31, 2006) 8

Estate of Schultz v. Potter,

No. 05-1169,

2010 WL 883710 (W.D. Pa. Mar. 5, 2010) 21

Fialka-Feldman v. Oakland Univ. Bd. or Trs.,

No. 08-14922,

2010 WL 2572768 (E.D. Mich. June 23, 2010) 17, 18

In re Meese,

907 F.2d 1192 (D.C. Cir. Spec. Div. 1990) 20

Jefferson v. City of Camden,

2006 WL1843178 (D.N.J. 2006) 13

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Killian v. Johnson & Johnson,

2009 WL 537666 (D.N.J. 2009) 13

Miller v. Holzman,

575 F. Supp. 2d 2 (D.D.C. 2008) 21, 28

United States v. NCH Corp.,

Nos. 98-5268, 05-881,

2010 WL 3703756 (D.N.J. Sep. 10, 2010) 22, 23, 32

United States ex rel. Doe v. Pa. Blue Shield,

54 F. Supp. 2d 410 (M.D.Pa. 1999) 28

United States ex rel. Educ. Career Dev., Inc. v. Cent. Florida

Reg’l Workforce Dev. Bd., Inc.,

2007 WL 1601747 (M.D. Fla. 1997) 27, 28

United States ex rel. Thompson v. Walgreen Co.,

621 F. Supp. 2d 710 (D.Minn. 2009) 29

State Court Cases

Rendine v. Pantzer,

661 A.2d 1202 (N.J. 1995) 7, 8, 10, 19

Walker v. Giuffre,

2 A.3d 1165 (N.J.App.Div. 2010) 10

Federal Statutes

31 U.S.C. § 3730 7, 29

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PRELIMINARY STATEMENT

Relator Steven Simring, M.D., (“Relator”), moves to collect

attorneys’ fees, costs and expenses as a result of a civil qui

tam action brought against the University of Medicine and

Dentistry of New Jersey (“UMDNJ”). Throughout the case, Relator

was primarily represented by two attorneys, Harry Litman, Esq.

(“Litman”) and Henry Furst, Esq. (“Furst,” together “Relator’s

Counsel”). To be clear, UMDNJ has never denied that Relator, as

a prevailing party, is entitled to reasonable attorneys’ fees.

That right is statutory. Throughout settlement negotiations

conducted since formally settling the underlying matter, UMDNJ

has repeatedly asserted its commitment to pay a reasonable fee,

in line with market rates in New Jersey. However, both during

settlement discussions and in the instant motion, Relator asks

this court to award exorbitant fees that are out of line with

the established market rate in New Jersey for the services

provided. The number of hours worked on this case by Relator’s

Counsel are similarly unreasonable. Their primarily blockbilled time entries show work that was “excessive, redundant and

otherwise unnecessary,” Hensley v. Eckerhart, 461 U.S. 424

(1983), and should therefore be excised from the ultimate award

of attorneys’ fees.

From the inception of this case through December 17, 2010,

Relator’s Counsel seeks attorneys’ fees, costs, and expenses

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totaling $1,081,570. This amount is based upon the following

unreasonable rates and hours:

 Furst billed 391.8 hours at a rate of $450 per hour,

totaling $176,310.00

 Litman billed 846.6 hours at a rate of $825 per hour,

totaling $698,445.00

 Relator’s Counsel claims expenses totaling $26,553.18

 20% requested lodestar enhancement, bringing the total to

$1,081,570.00

The rates billed by Relator’s counsel are wholly out of line

with the prevailing market rates charged by attorneys of similar

experience and skill in New Jersey. Instead, they represent the

absolute highest end of rates charged by the largest firms in

the state. Further, many of the hours charged are duplicative

and unnecessary, and the majority of billing entries provided by

Relator’s Counsel are vague at best. Both attorneys blockbilled their time, making it impossible to determine the amount

of time spent on inappropriate tasks, such as legal research

conducted by a professed expert in the False Claims Act (“FCA”).

Resolution of this issue has been unduly prolonged due to

Relator’s adamant refusal to recognize an appropriate market

rate for the work performed by Relator’s Counsel. UMDNJ has not

dragged its feet or been reticent to recognize its obligation to

pay. Relator expresses shock at UMDNJ’s apparent audacity in

requesting an accounting and disputing extraordinarily high

hourly rates, and protests the “haircut” sought by UMDNJ. This

“haircut,” though, is necessary to manage the unruly mess

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created by the exorbitant rates and unnecessary hours

memorialized in the vague block-billed time entries produced by

Relator’s Counsel.

While Relator’s Counsel played a role in the outcome of

this case, their claim to have “actively participated” in,

amongst other things, investigation, analysis, drafting,

negotiations, litigation and settlement of this case are

disingenuous. Relator’s Counsel did not litigate this case. No

discovery was conducted. No depositions were taken. No

interrogatories were propounded. No demands were made for

production of documents. No experts were retained. Litman

never even filed a notice of appearance or a pro hac vice

admission request. He is not admitted to practice in New

Jersey. Strikingly, between January 19, 2006 and March 16, 2009

– a period of 38 months in which Relator’s counsel insists they

were hard at work litigating this matter – absolutely nothing

occurred in this case. No motions. No conferences. No court

orders. Nothing.

Similarly, little time was spent investigating the case as

the Complaint was filed four days after Furst’s initial meeting

with Relator. Once the complaint was filed, Relator’s Counsel

rode the government’s coattails to settlement. Indeed, after

the proverbial whistle was blown, Relator’s Counsel stepped to

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the side and handed the reins of the investigation and

litigation over to the government.

There was nothing “complex” about the civil aspect of this

case. UMDNJ entered into a Deferred Prosecution Agreement

(“DPA”) with the government in December 2005, thereby accepting

responsibility for its actions. The DPA in effect established

liability in the qui tam action brought by Relator. All that

remained was to determine the appropriate amount of damages, a

task that cannot fairly be called “complex.”

Relator’s Counsel should be awarded attorneys fees in line

with the prevailing market rate in New Jersey. Litman, as an

experienced FCA practitioner with a substantial legal

background, should receive a rate similar to the $500 per hour

charged by the Honorable Herbert Stern, Esq., the attorney who

acted as the Federal Monitor to UMDNJ. Furst, as a solo

practitioner, should receive a rate that reflects the prevailing

rate for solo practitioners in New Jersey, $350 per hour. In

addition, for tasks performed by both that should have been

performed by an associate or junior attorney, such as legal

research, their rates should be reduced to $250 per hour. Time

entries that are vague, unnecessary and duplicative must be

deducted from the award. Time spent negotiating the Relator’s

share and that otherwise bears no relation to the case must be

rejected. Hours expended following the June 19, 2009 settlement

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must be denied. Relator’s Counsel’s requested expenses should

be reduced to $1,020 as Litman has provided no documentation of

expenses and $17,616 of Furst’s expenses, accounting for sums

paid to Steven Altman, Esq., (“Altman”) must be rejected.

Relator’s request for an upward adjustment of the lodestar by

20% should be denied, as this case was not overly complex, no

novel legal theories were argued, and recovery was practically

assured following UMDNJ’s entry into the DPA.

Given these necessary reductions, the appropriate fees,

costs and expenses due to Relator’s Counsel are approximately

$291,630.26. This total is comprised of (1) $201,300.00 in fees

for Litman, (2) $89,310.00 in fees for Furst, and (3) $1,020.26

in expenses.

BACKGROUND

Relator initiated this civil action under the qui tam

provisions of the FCA on July 23, 2004. Relator alleged that

University Hospital (“UH”) billed Medicare and Medicaid for the

same services that were billed by its faculty practice plan, codefendant University Physician Associates. The United States

Attorney’s Office (“USAO”) investigated this exact issue. That

investigation resulted in UMDNJ entering into the DPA with the

USAO in December 2005. The USAO recused itself from the instant

action, which was handled by the Department of Justice (“DOJ”)

in Washington, D.C. Plaintiffs filed an Amended Complaint in

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September 2005. There was a partial lifting of the Seal in

January 2006, followed by no docket entries for nearly three

years. DOJ formally intervened in 2009.

On June 19, 2009, the United States and UMDNJ settled the

matter for $4.45 million. Recognizing UMDNJ’s precarious

financial position, the government settled for single damages,

not the treble damages authorized by statute. Relator’s share

of the settlement was $800,000. Relator’s claim for attorneys’

fees, costs, and expenses were not part of that settlement. The

Court retained jurisdiction over the matter to provide the

parties with an opportunity to amicably resolve the attorneys’

fees issue.

The parties appeared before the Honorable Madeline Cox

Arleo, U.S.M.J. on two occasions to attempt to settle this

dispute. Neither settlement conference was successful. Relator

now moves before this Court, seeking to recover excessive and

unreasonable attorneys’ fees, costs and expenses.

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LEGAL ARGUMENT

I. RELATOR’S FEE REQUEST SUBSTANTIALLY EXCEEDS THE MARKET

RATE IN NEW JERSEY AND INCLUDES AN UNREASONABLE NUMBER OF

BILLABLE HOURS THAT SHOULD BE REDUCED BY THE COURT TO

REFLECT A REASONABLE LODESTAR

The FCA permits a relator to recover “an amount for

reasonable expenses which the court finds to have been

necessarily incurred, plus reasonable attorneys’ fees and costs”

against a settling defendant. 31 U.S.C. §§ 3730(d)(1)-(2). To

fix the size of the fee award, a court must determine the

appropriate billing rate for the party’s attorneys in the

relevant community, as well as the number of hours those

attorneys reasonably expended on the action. See Blum v.

Stenson, 465 U.S. 886, 888 (1984). The product of an attorney’s

hourly rate and the number of hours spent is referred to as the

“lodestar.” See, e.g., Student Pub. Interest Research Group v.

AT&T Bell Labs, 842 F.2d 1436, 1441 (3d Cir. 1988).

The Relator bears the burden of producing evidence that its

fees correspond to the market rate for the legal services

performed. Lanni v. New Jersey, 259 F.3d 146, 149 (3d Cir.

2001) (citing Smith v. Philadelphia Hous. Auth., 107 F.3d 223,

225 (3d Cir. 1997)). The Relator must also provide proof that

the hours claimed are reasonable. Rode v. Dellarciprete, 892

F.2d 1177, 1183 (3d Cir. 1990). Courts must scrutinize the

evidence presented in support of the fee application. Rendine

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v. Pantzer, 661 A.2d 1202, 1226 (N.J. 1995) (quoting Copeland v.

Marshall, 641 F.2d 880, 891 (D.C. Cir. 1980)(“Trial courts

should not accept passively the submission of counsel to support

the lodestar amount.”)). This demanding standard is further

heightened when the paying party is a public institution.

Barrett v. West Chester Univ. of Pa. of the State Sys. Of Higher

Educ., No. 03-CV-4978, 2006 WL 859714, *2 (E.D.Pa. Mar. 31,

2006) (requiring a “particularly careful” review of fees in such

a situation). This is especially true in the context of a cash

strapped public educational institution, where the

responsibility to pay the ultimate attorneys’ fees awarded will

rest with taxpayers and the quality of education provided to

students of the university may be negatively impacted. Id. at

*18.

Fee awards are an equitable matter. Hall v. Cole, 412 U.S.

1, 4-5 (1973). When the party seeking fees fails to meet its

burden, or when it requests an unreasonably high rate or an

unreasonable number of hours, the court can and should exercise

its equitable discretion to reduce the fee to the market rate

and the hours to a number reasonably required to perform the

billed-for work. In Lanni, for instance, the respondent to a

fee application produced evidence to show that the market rate

was “well below the rates claimed” by the fee applicant. 259

F.3d at 150. The Third Circuit remanded the case to allow the

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District Court to determine the applicable market rate and

appropriately reduce the applicant’s request. Id. Likewise, in

Maldonado v. Houstoun, 256 F.3d 181 (3d Cir. 2001), the court

adjusted an applicant’s unreasonably high rates to match a

market rate stated in a Community Legal Services, Inc. fee

schedule. The court determined that the rates contained in the

fee schedule were “a fair reflection of the prevailing market

rates” and denied any “hourly rates that [were] inconsistent

with them.” Id. at 187-88 (internal citations omitted).

Relator’s Counsel has requested fees above the New Jersey

market rate and hours that were excessive and inappropriate for

the tasks performed. The rates should be reduced so that they

are in line with the prevailing market rate in New Jersey, and

the hours should be whittled down to an appropriate amount of

time expended for the services provided.

A. Relator’s Counsel’s Requested Fee Rates Substantially

Exceed the Market Rate in New Jersey

The first step of the lodestar calculus is to determine the

appropriate, reasonable rate that may be charged by the fee

petitioner. Hensley v. Eckerhart, 461 U.S. 424, 433 (1983);

Rode, 892 F.2d at 1183 (3d Cir. 1990). In this case, the fee

applicants seek to be compensated at rates that far exceed the

appropriate, reasonable market rates that they are entitled to

under the statute and case law in the District of New Jersey.

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The attorneys’ billing rate “is not dispositive.” Pub.

Interest Research Group of N.J. v. Windall, 51 F.3d 1179, 1185

(3d Cir. 1995). Instead, a reasonable market rate is one “which

is adequate to attract competent counsel, but which does not

produce windfalls to attorneys.” Student Pub. Interest Research

Group of N.J., 842 F.2d at 1448. Courts are required to apply

the prevailing market rate in the relevant legal community,

Blum, 465 U.S. at 895; Rode, 892 F.2d at 1183; Rendine, 661 A.2d

at 1227, and must determine a reasonable rate that is “fair,

realistic, and accurate.” Walker v. Giuffre, 2 A.3d 1165

(N.J.App.Div. 2010)(internal citation omitted). Thus, an “out

of town lawyer would receive not the hourly rate prescribed by

his district but rather the hourly rate prevailing in the forum

in which the litigation is lodged.” Pub. Interest Research

Group of N.J., 51 F.3d at 1186. Plaintiffs must be allowed to

obtain counsel of their choice, but they may not be “permitted

to impose additional costs on defendants for . . . go[ing]

outside the district when ample competent local counsel [is]

available.” Id. at 1187 (citing Student Pub. Interest Research

Group of N.J. v. Monsanto Co., 721 F. Supp. 604, modified on

other grounds, 727 F. Supp. 876 (D.N.J.), aff’d, 891 F.2d 283

(3d Cir. 1989)).

The hourly rates requested by Relator’s Counsel are out of

line with the prevailing rates charged in New Jersey. The $825

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per hour demanded by Litman and the $450 demanded by Furst are

both excessive and unreasonable. As such, this Court should

exercise its equitable discretion to reduce these rates to a

reasonable amount, in line with amounts charged by attorneys of

like skill and experience in New Jersey. In place of their

requested rates, Litman should be awarded fees at the rate of

$500 per hour, a “reasonable hourly rate for a highly skilled

and credentialed District of New Jersey practitioner with

roughly 25 years of experience.” (Expert Report of William B.

McGuire, Esq. (“McGuire Report”), attached hereto as Exhibit A,

at 18). Similarly, Furst should be awarded fees at the rate of

$350 per hour. (McGuire Report at 20).

1. Litman Should be Granted a Reasonable Market Rate in Line

With Attorneys of Similar Experience and Skill in New

Jersey

Litman is a well-credentialed lawyer of twenty-three years.

He submits that his billing rate is $825 per hour, and he

demands this rate be applied to the fees owed by UMDNJ. In

support, he relies on a National Law Journal (“NLJ”) survey of

law firm billable rates. That survey reveals that partners at

New Jersey law firms McCarter & English and Lowenstein Sandler

charge up to $825 per hour and partners at Gibbons, P.C. charge

up to $790 per hour. (See Plaintiff’s Exhibit D). Missing from

Relator’s analysis of the survey were two other New Jersey law

firms: Archer & Greiner, which charges a maximum rate of $560

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per hour, and McElroy, Deutsch, Mulvaney & Carpenter, which

charges a maximum rate of $550 per hour. Id. Notably, UMDNJ

pays a maximum of $215 per hour to partners and $185 per hour

for associates for its outside litigation counsel.

What is clear is that these numbers do not represent the

market rate for similar services performed by a highly qualified

litigator in New Jersey, practicing between twenty and twentyfive years. Instead, the highest rates at large law firms are

often charged by transactional partners. (McGuire Report at

13). In New Jersey, the highest rates charged by litigation

partners at law firms range from $435 to $725 per hour.

(McGuire Report at 13). Outliers to this rule possess more

experience than Litman and all work at significantly larger law

firms than those with which Litman is affiliated.1 (McGuire

Report at 13).

Litman’s reliance on bankruptcy cases to justify the rate

he seeks is misplaced. He directs the Court to fees charged by

New York attorneys practicing in New Jersey’s Bankruptcy Courts.

This skews the facts. The lion’s share of fee authority in this

District consists of cases in which more experienced attorneys

than Litman are compensated at substantially lower rates. For

instance, in Jefferson v. City of Camden, 2006 WL 1843178

1 Litman is the principal of a two-person law firm, the Litman Law Firm, and Of

Counsel at Phillips and Cohen, LLP, a seventeen-person law firm.

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(D.N.J. 2006), the Court approved an hourly rate of $395 per

hour for an attorney admitted to the bar in 1968 – nearly two

decades before Litman. Similarly, in Killian v. Johnson &

Johnson, 2009 WL 537666 (D.N.J. 2009), the Court approved a fee

of $450 per hour for a partner who graduated law school in 1982

– four years before Litman. These rates represent the market as

it actually exists in New Jersey.

Litman should receive a rate no higher than that charged by

the Honorable Herbert Stern, who served as the Federal Monitor

to UMDNJ under the DPA. Judge Stern was admitted to practice

law in 1961. He served as the United States Attorney for the

District of New Jersey and as a United States District Court

Judge, in New Jersey and as the specially designated judge for

the United States Court for Berlin. Perhaps Litman is an

attorney of skill similar to Judge Stern, but he is certainly

without the same experience, having been admitted to practice

for twenty-six years less than Judge Stern. Judge Stern’s

billing rate, taking into account that he was working for a

public institution, was $500 per hour. As noted by Mr. McGuire,

Litman should be “honored to be compensated at the same level as

an established luminary of the bench and bar – a luminary with

far more experience than Mr. Litman.” (McGuire Report at 18-

19).

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Relator’s reliance on rates charged by firms such as

Buchanan, Ingersoll & Rooney in Pittsburgh, Foley & Lardner in

Milwaukee, or Loeb & Loeb and Chadbourne & Park in New York is

equally inappropriate as they are outside the forum of New

Jersey. The Court should compeletely disregard them. What

occurs “just across the river” has no bearing on the market rate

in New Jersey.

Litman asserts that he has “numerous clients” who have

retained him at the rate of $825 per hour, yet he “does not

specify if those clients are qui tam clients that may have no

reasonable expectation of actually paying him any portion of his

hourly fees.” (McGuire Report at 10 n.1). Litman further fails

to note the location of these purported clients. One would

assume that, if they were in New Jersey, he would have trumpeted

it. The forum in which the matter is litigated dictates the

hourly rate. See Blum, 465 U.S. at 888. The need for

expertise in a given area of law may justify a deviation from

the forum rate rule when the applicant can show that only

counsel from a “distant district” possesses the requisite

experience and skill to handle the case. Interfaith Cmty. Org.

v. Honeywell Int’l Inc., 426 F.3d 694, 705 (3d Cir. 2005).

Relator has produced absolutely no evidence to show that

Litman’s services were uniquely necessary to this litigation.

Furst’s billing records disclose no conversations with or

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attempts to retain co-counsel in New Jersey. Instead, it

appears that he went directly to Litman. There are assuredly

attorneys in New Jersey with the government experience and

expertise in handling FCA cases necessary to handle this case.

Because Litman chose to bring his services into New Jersey, he

is entitled to only the market rate paid in New Jersey.

2. Furst Should be Granted a Market Rate in Line with Solo

Practitioners of Similar Skill and Experience in New

Jersey

Furst has been a practicing member of the bar since 1977.

He was educated at Princeton University, where he graduated in

1974, and Rutgers School of Law Newark where he graduated in

1977. His practice appears to be “grounded in a core of

criminal defense litigation.” (McGuire Report at 9). Furst

seeks legal fees at the rate of $450 per hour. He provides

little support for his billing rate other than the opinion of

Raymond Brown, Esq., a well respected member of the New Jersey

bar.

Furst’s experience and reputation does not rise to the

level of preeminent New Jersey attorneys who practice

predominantly in the area of criminal defense. (McGuire Report

at 19). In addition, his “educational pedigree and False Claims

Act experience” are a mere shadow of his co-counsel in this

matter. (McGuire Report at 20).

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In a similar vein, it is not entirely clear why Furst’s

services were required after Litman was brought into the case.

Especially considering that much of this case was handled by DOJ

in Washington, D.C., there was little need for local counsel who

could “provide useful advice as to the unique attributes of the

local jurists and attorneys involved in the case.” (McGuire

Report at 20).

Based upon Litman receiving a fee of $500 per hour for his

services in this case, it would be unreasonable to award a fee

of $450 per hour to Furst. Instead, a billing rate of $350 per

hour would be appropriate for the work performed by Furst in

this case.

3. Both Attorneys’ Rates Should be Reduced for Time Spent

Performing Legal Research

The legal research conducted by Relator’s Counsel is

problematic for two reasons. First, it is not compensable at

the rates sought by Relator’s Counsel. Second, it was

unnecessary given Litman’s expertise in FCA matters, was not

related to the case, and was duplicative (discussed infra,

I(B)(2)). All legal research conducted by Relator’s Counsel

should be reduced to associate level rates. While compensating

a partner at one rate may be reasonable for most lawyerly tasks,

“the court may find that the reasonable rate of compensation

differs for different activities.” In re Fine Paper Antitrust

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Litigation, 751 F.2d 562, 583 (3d Cir. 1984)(internal citations

omitted)(finding that "[p]artners will not be compensated at

partner-level rates for tasks which are customarily performed by

junior associates[.]"). Indeed, paying clients will generally

refuse to pay for research time billed at partner level rates.

(McGuire Report at 15). Litman made billing entries for “legal

research” on seventy-four separate occasions, primarily in

block-billed entries totaling 178.4 hours2. Thus, he claims that

nearly one-quarter of his entire time spent on the underlying

matter was for legal research. That is a significant amount of

time given that there were no motions filed in the case and the

proclaimed expertise of Litman and Philips & Cohen, the preeminent FCA firm in the country. It is patently unreasonable

for an experienced lawyer with Litman’s background in the field

to spend close to 200 hours conducting his own research at an

hourly rate of $825 and not utilize junior attorneys to conduct

research.

The Eastern District of Michigan’s decision in FialkaFeldman v. Oakland Univ. Bd. of Trs., No.08-14922, 2010 WL

2572768 (E.D. Mich. June 23, 2010), relied on by Relator’s

Counsel, is distinguishable from the within matter. In FialkaFeldman, the court rejected an argument that plaintiff’s lead

2 This amount, and all other figures cited by UMDNJ throughout

this brief, is exclusive of any research conducted following

settlement of the underlying case (discussed infra, I(B)(7)).

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counsel should have charged an associate’s rate for time spent

conducting legal research, stating that “[t]his objection may

carry more weight if Plaintiff had been represented by a law

firm with several tiers of associates and partners.” FialkaFeldman, 2010 WL 2572768 at *6. Relator’s Counsel would have

this court believe that it should not accept a lower rate for

conducting research because both Litman and Furst work at small

firms without “several tiers” of attorneys. In the next breath,

though, Relator’s Counsel compares the fees they seek to charge

to those charged by McCarter & English, Gibbons and Lowenstein

Sandler, some of the largest firms in the country, let alone the

state of New Jersey. These firms all have associates who would

presumably conduct research at a rate significantly lower than

that charged by partners. Relator’s Counsel cannot have it both

ways. Instead, Relator’s Counsel’s rate for time spent

conducting legal research should be reduced to $250 per hour, a

reasonable associate’s rate in New Jersey, and a rate that is in

fact higher than UMDNJ pays partner level attorneys as outside

litigation counsel. (McGuire Report at 21).

B. Relator’s Counsel Seek Payment For an Unreasonable Number

of Hours Expended on This Case

The next step in the lodestar calculation is to determine

the number of hours reasonably expended on the case. Hensley,

461 U.S. at 433. “A prevailing party is not automatically

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entitled to compensation for all the time its attorneys spent

working on the case.” Interfaith Cmty. Org., 426 F.3d at 711.

“It does not follow that the amount of time actually expended is

the amount of time reasonably expended.” Copeland, 614 F.2d at

891; accord Interfaith Cmty. Org., 426 F.3d at 711. The party

seeking fees must set forth the requested hours “in sufficient

detail to permit the trial court to ascertain the manner in

which the billable hours were divided amongst the various

counsel.” Rendine, 661 A.2d at 1227. Courts are charged with

excluding hours that are “excessive, redundant, or otherwise

unnecessary.” Id.; accord Rode, 892 F.2d at 1183; Windall, 51

F.3d at 1188. Courts should also exclude hours due to

“inadequate documentation, duplication of effort,

unreasonableness of hours expended, or lack of relation to the

results obtained.” Apple Corps. v. Int’l Collectors Soc’y, 25

F. Supp. 2d 480, 484-85 (D.N.J. 1998). Finally, courts should

further exclude hours that were “spent litigating claims on

which the party did not succeed and that were distinct in all

respects from claims on which the party did succeed.”

Institutionalized Juveniles v. Sec. of Pub. Welfare, 758 F.2d

897, 919 (3d Cir. 1985)(internal citations omitted).

Qui Tam actions, by their very nature, fee-shift if the

relator is successful. Because of Relator’s Counsel’s selfprofessed extensive experience in Qui Tam litigation, Litman and

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Furst had to be aware when filing the underlying qui tam action

that they would be required to support the time and tasks

associated with representing Relator. In this case, Litman

seeks recovery for 846.6 hours of alleged work, and Furst seeks

recovery for 391.8 hours of alleged work. Excessive, redundant,

vague and duplicative time entries of 488.6 hours must be

excised from Litman’s time, and 152.7 hours must be removed from

Furst’s time.

1. Relator’s Counsel’s Excessive, Redundant and Vague

Billing Entries are Non-Recoverable

Relator’s Counsel’s time records are riddled with vague

entries. Vague time entries are often not paid by clients.

(McGuire Report at 16). Numerous entries by both Litman and

Furst merely state “call with” or “conf with” (as in original)

but provide no other information as to the call or conference’s

purpose. Such vague and inadequately documented billing entries

are unreasonable and should be stricken. Rode, 892 F.2d 1183;

Apple Corp., 25 F. Supp. 2d at 484-85; accord In re Meese, 907

F.2d 1192, 1204 (D.C. Cir. Spec. Div. 1990)(time entries in

which “no mention is made of subject matter of a meeting,

telephone conference or work performed during hours billed” are

“not adequately documented.”). Litman’s billing records contain

sixty-three such vague entires, accounting for 35.7 hours, which

must be excluded. Similarly, Furst’s billing records contain

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thirty-three vague entries, accounting for 12.3 hours, which

also must be excluded.

To compound the problem, Litman and Furst block-billed an

additional one-hundred seventy-nine entries containing the vague

“conf with” language. Sophisticated clients often forbid block

billing. (McGuire Report at 16). Block billing is likewise

viewed by the courts with disdain. “[B]lock billing ‘make[s] it

impossible for the court to determine, with any degree of

exactitude, the amount of time billed for a discrete activity,’

leaving the court ‘to estimate the reduction to be made because

of such insufficient documentation.’” Miller v. Holzmann, 575

F. Supp. 2d 2, 37 (D.D.C. 2008)(quoting In re Olsen, 884 F.2d

1415, 1428-29 (D.C. Cir. Spec. Div. 1989)). Thus, a party

“block bills at his own peril.” Estate of Schultz v. Potter,

No. 05-1169, 2010 WL 883710, at *7 n.14 (W.D.Pa. Mar. 5, 2010).

Litman’s time entries include one-hundred seventy-two block

billed entries, totaling 423.8 hours. Furst’s entries contain

seven entries, totaling 18.1 hours. Because of the block-billed

nature of these entries, it is impossible to determine how much,

if any, time was actually dedicated to the various tasks

identified in each entry.

When a fee applicant submits block billed time records,

“they perhaps should be given the opportunity to specify and/or

clarify their entries to the satisfaction of the Court.”

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(McGuire Report at 22). However, considering that some the time

entries in this case were recorded more than five years ago, it

would be an exercise in futility to permit Relator’s Counsel an

opportunity to clarify their time records at this late stage of

the dispute. Thus, UMDNJ proposes that one third of these

entries, or 141.3 hours from Litman and 6.0 hours from Furst, be

deducted from Relator’s Counsel’s time to account for the vague

and inappropriate billings.

This approach is consistent with the approach recently

taken by the Court in United States v. NCH Corp., Nos. 98-5268,

05-881, 2010 WL 3703756 (D.N.J. Sep. 10, 2010), a decision that

Relator clearly misreads. Rather than supporting the practice

of block billing, the Court held that “when there is confusion

due to block billing, the blame lies on the party seeking fees

because they were in the best position to mitigate any confusion

by task billing.” Id. at *5. The Court significantly reduced

the fee applicant’s request, in some instances by up to 50%, due

to the confusion caused by the applicant’s use of block billing.

Id. (“the significant use of ‘block billing’ employed by [the

fee applicant], in this instance, thwarts the Court in the

performance of its review obligations and does not reasonably

meet [the applicant’s] obligation to provide ‘some fairly

definite information as to the hours devoted to various general

activites’ and by whom.”). Relator’s Counsel knew at the

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inception of this case that they would be required to provide

billing records sufficient to allow this Court to perform its

review in order to determine whether a reasonable number of

hours were spent on various tasks performed during the

representation. As stated in NCH Corp., the blame for the

confusion created by Relator’s Counsel’s decision to block bill,

and the inability of the court to determine the amount of time

spent on discrete, inappropriate tasks, such as the vague “conf

with” entries listed above, rests solely with Relator’s Counsel.

UMDNJ should not be forced to pay exorbitant amounts simply

because Relator’s Counsel did a poor job of timekeeping.

UMDNJ’s request to reduce Relator’s Counsel’s excessive blockbilled entries by 33% is therefore appropriate and in line with

approaches previously taken in the District of New Jersey.

2. Relator’s Counsel’s Billing Entries for Research are

Excessive

When attempting to fee shift, counsel is mandated to

properly account for time spent and to do so judiciously and

economically. See Hensley, 461 U.S. at 434. Relator's counsel

did neither. A district court reviewing a fee application is

vested with the discretion to (1) determine that the hours

expended on a certain task were excessive, and (2) determine

"that a certain number of hours would be a reasonable number of

hours to expend on that task." Rode, 892 F.2d at 1187. Given

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Litman’s national reputation for being a FCA lawyer, Relator’s

Counsel spent an excessive amount of time conducting legal

research. This Court should cut the time spent performing legal

research in half.

As noted above, research appears in seventy-four of

Litman’s time entries, totaling 178.4 hours. Considered another

way, this amounts to just over twenty-two 8-hour work days, or

more than four full work weeks, spent researching by a professed

expert in the FCA. The topics block billed as research by Litman

include, among others: privilege, state whistleblower suits,

joint and several liability, state and federal Medicare and

Medicaid regulatory scheme, overpayments, possible conflict,

other states regulatory schemes re: payor of last resort,

Stevens3 and related issues, Eleventh Amendment, falsity and FCA,

public entities, information sharing, Barajas4, derivative claim,

original source, catalyst theory, Third Circuit Statute of

Limitations, causation, administrative termination, possible

FOIA action, designation of parties, scope of release,

admissions and collateral liability, possible bribery,

settlement agreement, government intervention, liability for

omissions, costs and fees, settlement in multi-defendant cases,

3 VT Agency of Natural Res. v. United States ex rel. Stevens, 529

U.S. 765 (2000).

4 United States ex rel. Barajas v. Northrup Grumman Corp., 258

F.3d 1004 (9th Cir. 2001).

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and Federal Rule of Evidence 408. Only the Stevens/Eleventh

Amendment entries even appear relevant to the within matter as

UMDNJ considered and discussed with DOJ filing a motion to

dismiss on Eleventh Amendment grounds since UMDNJ is a State

entity.

Furst recorded fourteen separate block billed entries for

research, which totaled approximately 45 hours. Furst also

researched several of the topics that Litman researched. These

included: Medicaid billing regulations, Stevens, Barajas,

catalyst theory, Eleventh Amendment, and scope of release.

These entries should be disregarded entirely as redundant or

duplicative.

Four of Litman’s entries, totaling 2.5 hours worth of work,

were not block billed. The remaining sixty-one entries,

encompassing 175.9 hours, are block billed entries. Five of

Furst’s entries, totaling 15.6 hours of work were not block

billed, with the remaining 29.5 hours appearing as part of block

billed entries. Again, one-half of this time should be

rejected. At least six of the research projects are

duplicative. A reduction for duplication of effort is warranted

when “the attorneys are unreasonably doing the same work."

Rode, 892 F.2d at 1188 (emphasis in original). Given Litman's

stated expertise in FCA litigation and familiarity with the

instant matter, Furst's research of the same topics as Litman is

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duplicative. See Planned Parenthood of Cent. N.J. v. Attorney

General of N.J., 297 F.3d 253, 272 (3d Cir. 2002)("[T]he

attendance of additional counsel representing the same interests

as the lawyers actually conducting the litigation is wasteful

and should not be included in a request for counsel fees from an

adversary"); see also Lanni, 259 F.3d at 151 ("Given [counsel's]

professed expertise in this area, it would not have been

unreasonable to expect her to conduct the trial alone or with

the help of an associate" as opposed to another partner).

Further, as it was unreasonable for Relator’s Counsel to charge

excessive partner rates for research, so too is it unreasonable

to conduct over 220 hours of combined research in an area of law

in which Litman presents himself as an expert. As such, one

half of the total time spent, whether block billed or not,

should be deducted from Relator’s Counsel’s time entries. Such

a reduction would remove 89.2 hours from Litman’s total and 22.5

hours from Furst’s total.

3. Relator’s Counsel’s Billing Entries that Bear No

Relationship to the Qui Tam Case are Not Recoverable

Relator’s Counsel’s time records reveal that they expended

considerable time on matters that lacked a relationship to its

claims against UMDNJ. Time spent that lacks a relationship to

the results obtained in a qui tam case is not compensable.

Apple Corps., 25 F. Supp. 2d at 484-85. For instance, Relator’s

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Counsel seek compensation from UMDNJ for time spent litigating

its case against UPA. UMDNJ should not be required to pay legal

fees that Relator allegedly incurred prosecuting his case

against other defendants; here UPA and its directors and

officers. Should Relator prevail in his ongoing FCA case

against UPA, he will be entitled to fees from those defendants.

Any award of fees for tasks performed in connection with

prosecuting Relator’s claims against other defendants now could

amount to an improper double recovery.

Relator’s Counsel further seek compensation for time spent

reviewing newspapers articles about unrelated events at UMDNJ,

such as break-ins at one of its administrative offices and FCA

cases brought against other hospitals. All told, Litman spent

1.3 hours of non-block-billed time pursuing tasks unrelated to

the qui tam case. Furst spent 20.1 hours pursuing such

unrelated tasks. These hours must be excluded from the award of

attorneys’ fees.

Complicating this analysis is the fact that Relator’s

Counsel’s block-billed time entries commingle unrelated tasks

with purportedly related ones. For example, on September 14,

2005, Litman spent 9.4 hours on drafting the Amended Complaint

and "review of materials re CMS manuals." The latter work is

not compensable because it represents time spent getting up to

speed. United States ex rel. Educ. Career Dev., Inc. v. Cent.

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Florida Reg’l Workforce Dev. Bd., Inc., 2007 WL 1601747, *4

(M.D. Fla. 1997)("[T]ime spent 'getting up to speed' or learning

about the principles of qui tam actions, which does not advance

the case and was not a result of Defendants' actions, is not

reasonably billed to a client or one's adversary."). Such

entries cannot be separated with accuracy and must be construed

against the movant. See Miller, 575 F. Supp. 2d at 37. Under

the same principal, the time Litman expended determining whether

a conflict of interest existed amongst his litigation team at

Phillips & Cohen is not recoverable. See, e.g., United States

ex rel. Doe v. Pa. Blue Shield, 54 F. Supp. 2d. 410, 419

(M.D.Pa. 1999). Litman unreasonably block-billed approximately

16.9 hours to tasks that were unrelated to his representation of

Relator in this action and are not recoverable. Furst likewise

unreasonably block-billed 9.4 hours on non-recoverable tasks.

Like the vague entries above, the time acknowledged from

Relator’s Counsel’s block-billed entries should be reduced.

UMDNJ again proposes that one third of these entries should be

disallowed, resulting in 5.6 hours being deducted from Litman’s

total and 3.2 hours being deducted from Furst’s total.

4. Hours Devoted by Relator’s Counsel to the Recovery of the

“Relator’s Share” is Non-Compensable

Relator's Counsel seek to recover fees for the time they

expended negotiating Relator's share. A relator’s share is set

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between 15 percent and 25 percent of the proceeds of the action

or settlement of the claim, “depending upon the extent to which

the relator contributed to the prosecution of the action."5 31

U.S.C. 3730(d)(1). Typically, a relator’s counsel expends time

advocating to the Government for a greater share of the recovery

for his client. See, e.g., United States ex rel. Taxpayers

Against Fraud v. Gen. Elec. Co., 41 F.3d 1032, 1045-46 (6th Cir.

1995); United States ex rel. Thompson v. Walgreen Co., 621 F.

Supp. 2d. 710, 727 (D.Minn. 2009). However, time spent by a

relator's counsel negotiating or litigating the relator's share

with the United States is not recoverable in a fee application.

Taxpayers Against Fraud, 41 F.3d at 1045-46; accord Thompson,

621 F. Supp. 2d. at 727 ("The greater weight of authority

disallows compensation for attorney's fees and costs incurred in

connection with the relator's share negotiation/litigation.").

Here, Litman spent 0.9 hours of non-block-billed time

negotiating the relator’s share. Furst spent 27.2 hours. These

hours must be excluded from the award of attorneys’ fees in this

case.

In addition, Litman spent an additional 7.2 hours and Furst

an additional 7.6 hours of block-billed time negotiating the

relator’s share. As with vague entries and unrelated entries,

5 In this case, Relator received $800,000, roughly 18% of the

$4.45 million proceeds of the action.

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UMDNJ proposes that Relator’s Counsel’s time be reduced by one

third, resulting in 2.4 hours being deducted from Litman’s total

hours billed and 2.5 hours being deducted from Furst’s hours.

5. Relator’s Counsel’s Time Searching for Expert Witnesses

May Not Be Recovered

Relator’s Counsel’s time records indicate that Litman spent

4.6 hours of non-block-billed time in order to find an expert

for the case. Litman spent an additional 39.4 hours of blockbilled time on this issue. Furst spent 22.1 hours, all nonblock billed, on attempting to retain an expert. All of the

non-block billed time and one third of Litman’s block-billed

hours, or 13.1 hours, should be excluded. While the Third

Circuit has approved recompensing fees to experts who do not

testify, Interfaith Cmty. Org., 426 F.3d at 716, this is not a

request for expert fees. Instead, these are hours that were

expended by Relator’s Counsel to obtain an expert in the first

instance – but no expert was ever retained as no expert was

needed. The underlying case is one in which liability was a

forgone conclusion because of UMDNJ’s entry into the DPA. No

expert reports were written, no depositions of experts were

taken, and because Litman is a purported expert in the FCA,

certainly no experts were necessary to advise Relator’s Counsel.

As such, this time must be excluded from Relator’s fee request.

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6. Relator’s Counsel’s May Not Be Recompensed For

Duplicative Time Entries

When seeking fees, the requesting attorney is required to

review his billing records to exclude excessive, redundant and

unnecessary fees, “just as a lawyer in private practice

ethically is obligated to exclude such hours from his fee

submission.” Hensley, 461 U.S. at 434. Relator’s counsel did

not fulfill the ethical obligation to review their billing

entries, as is evident by the duplicative billing entries

submitted with their motion. For example, Litman’s time records

include two entries on October 26, 2007 with identical

descriptions. One of these entries, therefore, must be

excluded. In total, Litman’s time records include 5.2 hours of

duplicative time entries. While 5.2 hours may not seem like a

great deal of time, at Litman’s requested rate of $825 per hour,

Relator’s oversight could cost UMDNJ $4,290.00, an expensive

mistake. Litman’s hours must therefore be reduced by a minimum

of 5.2 hours.

7. Hours Billed Following Settlement on June 19, 2009 Must

Be Excluded, Including Fees Stemming from this Fee

Dispute

The underlying qui tam action filed by Relator was settled

on June 19, 2009. Despite the settlement, Relator’s Counsel has

continued to bill the file, both substantively and for fees

sought in connection with this fee dispute. Since the

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settlement date, Litman has billed an additional 100.1 hours.

Furst has billed 14.2 hours in that same time period. To the

extent that these hours were billed for legal work on the

underlying case, they must be disallowed. It would be absurd to

permit Relator to collect on hours expended after the resolution

of the case. Such hours are certainly not UMDNJ’s

responsibility.

Ordinarily, the fee applicant may recover fees sought in

connection with a fee dispute. However, in cases such as this

where the fee applicant causes the ongoing delay and need for

litigation, fees and costs in connection with the application

should not be awarded. NCH Corp., 2010 WL 3703756 at *11 (“This

fee dispute is caused, in part, because of confusions arising

out of [the fee applicant]’s billing practices. This Court will

not reward any ambiguity associated with [the fee applicant]’s

invoices by awarding fees or costs for this application.”). As

in NCH Corp., it is the fee applicant’s poor billing practices,

e.g. block billing, vague entries, and excessive and redundant

entries, in this case that have caused this fee dispute to go

unresolved since the underlying case settled. Since the

settlement date, UMDNJ has reasonably sought an accounting for

the excessive hours billed and unreasonably high rates charged

by Relator’s Counsel. Relator’s Counsel’s bullish refusal to

accept market rates, together with their slipshod billing

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practices – especially when they knew that they would be

required to substantiate their time and legal work to justify

their fees under the statute – were the primary cause of this

dispute. As such, UMDNJ should be relieved of paying any fees

in connection with pursuing this fee dispute.

C. Calculation of the Lodestar

Following determination of a reasonable hourly rate and a

reasonable number of hours spent working on the case, the Court

must calculate the actual lodestar amount by multiplying the

rate by the reasonable hours expended. Rode, 892 F.2d at 1183.

Litman’s lodestar should be calculated as follows:

Hours requested: 846.6

Less non-Block Billed Conference Time -35.7

Less 1/3 of Block Billed Conference Time -141.3

Less non-Block Billed Unrelated Time -1.3

Less 1/3 of Block Billed Unrelated Time -5.6

Less non-Block Billed Relator’s Share -0.9

Less 1/3 Block Billed Relator’s Share -2.4

Less All Time Spent Researching -178.4

Less non-Block Billed Expert Time -4.6

Less 1/3 Block Billed Expert Time -13.1

Less Duplicative Time -5.2

Less Hours Spent After Settlement -100.1

Total: 358.0

Reasonable Market Rate $500/hour

Total: $179,000.00

Plus 89.2 hours of research at $250/hour +$22,300.00

GRAND TOTAL: $201,300.00

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Furst’s lodestar should similarly be calculated as follows:

Hours requested: 391.8

Less non-Block Billed Conference Time -12.0

Less 1/3 of Block Billed Conference Time -6.0

Less non-Block Billed Unrelated Time -20.1

Less 1/3 of Block Billed Unrelated Time -3.2

Less non-Block Billed Relator’s Share -27.2

Less 1/3 Block Billed Relator’s Share -2.5

Less All Time Spent Researching -45.0

Less non-Block Billed Expert Time -22.1

Less 1/3 Block Billed Expert Time -0.0

Less Duplicative Time -0.0

Less Hours Spent After Settlement -14.2

Total: 239.1

Reasonable Market Rate $350/hour

Total: $83,685.00

Plus 22.5 hours of research at $250/hour +$5,625.00

GRAND TOTAL: $89,310.00

Adding Litman and Furst’s grand totals, the total lodestar

amount equals $290,610.00.

II. NO ENHANCEMENT SHOULD BE APPLIED TO THE LODESTAR BECAUSE

RELATOR HAS FAILED TO SATISFY THE CRITERIA SET FORTH BY

THE SUPREME COURT TO ESTABLISH SUCH A MULTIPLIER

“The product of reasonable hours times a reasonable rate

does not end the inquiry.” Hensley, 461 U.S. at 434. The court

has “the discretion to make certain adjustments to the

lodestar,” and the “party seeking adjustment has the burden of

proving that an adjustment is necessary.” Rode, 892 F.2d at

1183. In this case, Relator’s Counsel satisfies none of the

criteria for an upward modification of the lodestar.

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A. Relator’s Counsel Cannot Satisfy the Requirements set

by the Supreme Court for Upward Modification

Upward modification of the lodestar is exceedingly rare,

and justified in only limited circumstances. Relator’s Counsel

seeks a lodestar enhancement due to the alleged novelty and

complexity of the case, the skill of counsel, the results

obtained, and the contingent nature of the fee. The burden of

establishing an enhancement “must be borne by the fee

applicant.” Perdue v. Kenny A. ex rel. Winn, __ U.S. __, 130

S.Ct. 1662, 1667 (2010).

Factors such as complexity or novelty of the case are

inappropriate to consider when contemplating a lodestar

enhancement. Perdue, 130 S.Ct. at 1673. “The novelty and

complexity of a case generally may not be used as a ground for

an enhancement because these factors presumably [are] fully

reflected in the number of billable hours recorded by counsel.”

Id. (internal quotations and citations omitted). Similarly, the

skill of counsel should not be considered in a lodestar

modification. Id. Like novelty and complexity issues, the

skill of counsel is “normally reflected in the reasonable hourly

rate.” Id. (internal citations omitted). Any argument to the

contrary presented by Relator’s Counsel must be disregarded.

In fact, the Supreme Court has limited the availability of

upward modifications of the lodestar to three situations: (1)

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delay in payment, (2) in the “very rare circumstances where the

attorney’s work is so superior and outstanding that it far

exceeds the expectations of clients and normal levels of

competence,” Student Pub. Interest Research Group of N.J., 842

F.2d at 1453, and (3) the necessity of attracting competent

counsel, known as the contingency multiplier. See, e.g., Rode,

892 F.2d at 1184.

Delay in payment is not a factor here, as any delay is

recovered by use of the current market rate, as opposed to the

rate charged by counsel at the outset of the case. Perdue, 130

S.Ct. at 1675 (citing Missouri v. Jenkins, 491 U.S. 274, 282

(1989)). To the extent Relator argues that delay should

nevertheless be considered as a factor due to the length of time

it has taken to resolve this fee dispute, any such delay stems

not from UMDNJ’s actions, but rather from Relator’s Counsel’s

obstinate refusal to accept a reasonable market rate for

services undertaken. Further, any delay caused by the matter

being moved from one court to another based on the recusal of a

judge should not count against UMDNJ.

This case also does not present the rare case where the

attorney’s work is “so superior and outstanding that it far

exceeds the expectations of clients and normal levels of

competence.” Student Pub. Interest Research Group of N.J., 842

F.2d at 1453. Relator’s Counsel had little work to do in this

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case to obtain recovery for their client, as is evidenced by the

complete absence of any discovery or motion practice. The DPA

signed by UMDNJ in December 2005 for all intents and purposes

established liability in this civil suit, and Relator’s Counsel

was able to ride the government’s coattails to settlement of the

underlying matter. For that same reason, there was little doubt

that the government would intervene. Any argument by Relator’s

Counsel that their expertise in the FCA caused them to expend

fewer hours on this case is clearly belied by the surplus of

hours spent by both Litman and Furst conducting legal research.

Finally, Relator has presented no evidence that a

contingent fee multiplier was required to attract competent

counsel to this case. Nowhere in Relator’s Counsel’s billing

records is there any indication that Relator sought counsel in

New Jersey. The number of cases brought against UMDNJ, belies

any notion that there is a dearth of competent counsel in New

Jersey willing to accept a contingent fee in matters such as

this. There was very little risk to obtaining recovery in this

case. Therefore, no upward modifier to the lodestar is

warranted.

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III. EXPENSES ARE NOT INCLUDED IN THE LODESTAR AND THE

EXPENSES SUBMITTED BY FURST ARE INAPPROPRIATE AND NOT

RECOVERABLE

The lodestar calculation consists only of the product of

the reasonable market rate and the reasonable hours worked by

the attorneys. Blum, 465 U.S. at 888. Expenses are not figured

into this calculation. Instead, they are added to the total

after the lodestar has been calculated and are not subject to

lodestar enhancement or reduction.

In this case, Relator’s Counsel claims expenses totaling

$26,553.18. However, with their submissions, they have only

included documentation for $18,636.26 in expenses, attached to

Furst’s time records. The $7,916.92 difference between the

requested figure and the documentation submitted must be

deducted from the ultimate award.

In addition, Furst’s expenses include $17,616.00 in

expenses paid to Steven Altman, a Washington, D.C. attorney

retained by Relator’s Counsel to assist with dealings with DOJ.

Relator’s Counsel’s attempt to pass off Altman’s fees as an

“expense” is merely an attempt to circumvent the lodestar

calculation and force UMDNJ to pay Altman the market rate

charged by an attorney in Washington, D.C. Relator has

presented no evidence of the rate charged by Mr. Altman or of

the hours he worked on this case. Without this necessary

information, the Court cannot conduct a lodestar calculation to

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determine the appropriate fees, if any, to be paid to Mr.

Altman. As such, the $17,616.00 must be disregarded.

The total expenses owed to Relator’s Counsel, then, is the

remaining $1,020.26 from Furst’s expenses request. This amount

should be added to the lodestar after any modifications.

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CONCLUSION

Relator seeks unreasonable fees and expenses from UMDNJ, a

public entity, as a result of being the prevailing party in the

underlying qui tam action. The rates sought by Relator’s

Counsel must be reduced to the market rate in the District of

New Jersey. Likewise, the hours expended by Relator’s Counsel

on this case must be reduced to a reasonable number of hours,

and billing entries that are vague, excessive or duplicative

must be excised. Finally, Relator’s requested expenses must be

reduced to only those expenses that are properly recoverable.

The lodestar in this case is $290,610.00. When Relator’s

fees of $1,020.26 are added, the grand total, and the

appropriate award for fees and costs in this case, is

$291,630.26.

Respectfully submitted,

/s/ Walter F. Timpone

Walter F. Timpone

McElroy, Deutsch, Mulvaney &

Carptenter, LLP

1300 Mt. Kemble Avenue

P.O. Box 2075

Morristown, NJ 07962

Attorneys for Defendant, UMDNJ

Dated: March 1, 2011

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