Opinion ID: 4698494
Heading Depth: 2
Heading Rank: 2

Heading: Attorney’s Fees and Defense Costs

Text: Country Mutual next argues that the district court erred in awarding Continental attorney’s fees and defense costs equal to the amount Continental spent to defend Hamel Fire in the underlying suits. Country Mutual primarily challenges the reasonableness of that award, but we will first address some evidentiary decisions that Country Mutual’s appeal implicates.
Country Mutual argues that “[b]y ignoring and striking the affidavit of Steve Mudge and refusing to have an evidentiary hearing, the trial court created a new standard on fee petitions of just requiring a submission of time entries with a statement that they have been paid, which is not the standard for fee petitions requiring that the entire award be vacated.” We review both decisions for an abuse of discretion. See Magyar v. Saint Joseph Reg’l Med. Ctr., 544 F.3d 766, 770 (7th Cir. 2008) (affidavit); Royce v. Michael R. Needle P.C., 950 F.3d 481, 487 (7th Cir. 2020) (evidentiary hearing). First, as to the stricken affidavit, we have repeatedly held that a district court acts properly when it enforces deadlines. See, e.g., Spears v. City of Indianapolis, 74 F.3d 153, 157 (7th Cir. 1996). “Moreover, even arguments that have been raised [in the district court] may still be waived on appeal if they are No. 20-2962 15 underdeveloped, conclusory, or unsupported by law.” Puffer v. Allstate Ins. Co., 675 F.3d 709, 718 (7th Cir. 2012). On this issue, the district court said that two days before the damages oral argument: [W]ithout any advance notice or leave of Court, Country Mutual filed an affidavit from Stephen Mudge, an attorney who represented Country Mutual’s insured in the Underlying Lawsuits. The affidavit purported to dispute the accuracy of several billing entries in Continental’s billing records. … [T]he Court heard argument on the issue of damages. Because Country Mutual’s affidavit was filed out of time and without leave of Court—and with no explanation as to why it was being filed—the Court struck the affidavit from the record. (Citations omitted). The court’s decision to enforce its deadlines and rules for submitting affidavits was not an abuse of discretion. See Spears, 74 F.3d at 157. Even if enforcing deadlines may sometimes be an abuse of discretion, Country Mutual built no argument for such a finding here. On appeal, Country Mutual again provides no reason for why it should have been allowed to untimely and improperly file the Mudge affidavit, and it does not engage with the district court’s reasoning, so the argument is waived. See Puffer, 675 F.3d at 718. Second, as to the stricken evidentiary hearing, we have held “it is not an abuse of discretion to decline to conduct an evidentiary hearing ‘that would only address arguments and 16 No. 20-2962 materials already presented to the court in the parties’ briefings.’” Royce, 950 F.3d at 487 (quoting Pickett v. Sheridan Health Care Ctr., 664 F.3d 632, 652 (7th Cir. 2011)). The district court ultimately struck the evidentiary hearing because Country Mutual already had “ample opportunity to provide any evidence and to set forth any and all objections to the claimed attorneys’ fees and defenses costs within its briefing.” As discussed in greater detail below, the district court had considerable evidence from Continental to support its award of attorney’s fees. Country Mutual could have challenged that evidence however it pleased at the appropriate time. As Country Mutual opted not to take that opportunity, the court was free to foreclose an opportunity for Country Mutual to provide evidence anew. See id. 2. District Court’s Award of Attorney’s Fees and Defense Costs More directly, Country Mutual challenges the district court’s award of attorney’s fees and defense costs as unreasonable. Because “[d]istrict courts have wide discretion in determining the appropriate amount of attorneys’ fees and costs,” our review “is limited to a highly deferential abuse of discretion standard.” Spegon v. Cath. Bishop of Chi., 175 F.3d 544, 550 (7th Cir. 1999). In Illinois, fee awards must always be reasonable, see Platinum Supplemental Ins., Inc. v. Guarantee Tr. Life Ins. Co., 989 F.3d 556, 571 & n.7 (7th Cir. 2021) (citing Powers v. Rockford Stop-N-Go, Inc., 761 N.E.2d 237, 240 (Ill. App. Ct. 2001)), and “the party seeking the fees … always bears the burden of presenting sufficient evidence from which the trial court can render a decision as to their reasonableness.” Kaiser v. MEPC Am. Props., Inc., 518 N.E.2d 424, 427 (Ill. App. Ct. 1987). No. 20-2962 17 However, the attorney’s fees in this case were paid, and Illinois courts have said “[t]he prima facie reasonableness of a paid bill can be traced to the enduring principle that the free and voluntary payment of a charge for a service by a consumer is presumptive evidence of the reasonable or fair market value of that service.” Arthur v. Catour, 833 N.E.2d 847, 854 (Ill. 2005) (citing cases); see also Pickett, 664 F.3d at 653–54 (noting, albeit in the context of federal law, that the “best evidence of whether attorney’s fees are reasonable is whether a party has paid them.” (quoting Cintas Corp. v. Perry, 517 F.3d 459, 469–70 (7th Cir. 2008))). Here, Continental presented the district court with detailed line-item entries for all its bills paid to defend Hamel Fire in the underlying lawsuits. Continental also furnished an affidavit by an employee, Keith Keller, confirming that Continental paid them.3 Thus, the district court’s award of that amount was presumptively reasonable. See id. Setting aside the evidence that the bills were paid, we conclude the district court’s award of $240,146.18 in attorney’s fees and defense costs was reasonable—and therefore not an abuse of discretion. Country Mutual has failed to show otherwise. Under Illinois law, a “petition for fees must specify the services performed, by whom they were performed, the time expended thereon and the hourly rate charged therefor.” 3 In light of the line-item entries and other evidence presented by Continental, we are unpersuaded by Country Mutual’s argument that various documents failed to satisfy Continental’s burden. What is more, on appeal we are not concerned with whether Continental in fact met its burden but rather whether the district court abused its discretion in finding that Continental satisfied that burden, a highly deferential bar. See Spegon, 175 F.3d at 550. 18 No. 20-2962 Kaiser, 518 N.E.2d at 427. A “mere compilation of hours multiplied by a fixed hourly rate or bills issued to the client” is typically insufficient. Id. Additionally, a trial court must consider a host of factors to arrive at a reasonable award, including “the skill of the lawyers, the difficulty and importance of the case, usual charges for similar services, the benefit to the client, and ‘whether there is a reasonable connection between the fees and the amount involved in the litigation.’” Abellan v. Lavelo Prop. Mgmt., LLC, 948 F.3d 820, 835 (7th Cir. 2020) (quoting Kaiser, 518 N.E.2d at 427–28); Kaiser, 518 N.E.2d at 428 (instructing courts to also consider “the nature of the case” and “degree of responsibility required”). The district court began by noting how Continental “provided detailed billing records for the attorneys who provided the defense to Hamel Fire” to support the $240,146.18 of attorney’s fees and defense costs requested. This amount reflected attorney’s fees Continental paid to two law firms ($20,466.94 and $180,010.30) as well as $39,669.02 in defense costs. 4 With respect to the attorney’s fees, far from a “mere compilation of hours multiplied by a fixed hourly rate,” Kaiser, 518 N.E.2d at 427, Continental provided the district court with hundreds of pages of exhibits containing line entries for every dollar of fees it incurred to defend Hamel Fire in the underlying lawsuits. Each entry contained the name of the attorney performing the task, the line-item number, the task 4 Our calculation of these amounts ($20,466.94 + $180,010.30 + $39,669.02) resulted in $240,146.26, not the $240,146.18 that the district court awarded. Given the de minimis difference of eight cents and the affirmative miscalculations Continental provided the district court in its Brief Regarding the Calculation of Damages, we deem any potential challenge to the calculation of the fees on this basis waived. No. 20-2962 19 date, the fee-approval date, a description of work, the time spent on the task, the hourly rate charged, and the total amount billed. Therefore, Continental’s specifications satisfied its obligation to detail “the services performed, by whom they were performed, the time expended thereon and the hourly rate charged therefor.” Id. With respect to the $39,669.02 in defense costs, the court noted how Continental “submitted documentation of all defense fees and costs it paid in defending Hamel Fire.” As the court summarized, Keller attested in his affidavit that Continental incurred these costs for “court reporting, professional medical record review and analysis, printing services, and forensic crash analysis costs.” Continental’s brief to the district court also contained an item-by-item breakdown of the corresponding amounts paid. Without basis, Country Mutual argues that Continental’s records were deficient. It contends that Continental’s billing entries reflected multiple attorneys improperly performing the same tasks. It also argues Continental provided “no work product and no explanation” for its invoices. However, Country Mutual has not pointed to—and we have not found— caselaw precluding more than one attorney working on a task or requiring plaintiffs produce work-product evidence to justify already detailed (and in this case, paid) fee invoices. Moreover, Country Mutual did not identify a single duplicative, insufficiently described, or otherwise deficient entry. See Abellan, 948 F.3d at 836 (“[The defendant] does not challenge the specifics of [the plaintiff’s] attorneys’ hours expended or hourly rates.”). As such, Country Mutual’s unsubstantiated challenges to Continental’s evidence are unavailing. 20 No. 20-2962 After discussing the evidence supporting Continental’s fee request, the district court proceeded to discuss the many factors Illinois law requires courts to consider when assessing the reasonableness of attorney’s fees. Specifically, it highlighted “the skill of the lawyers … [and] usual charges for similar services.” See id. at 835. Given the length of the litigation prior to this lawsuit, Continental retained two firms over more than five years. It hired an experienced litigator at Heyl, Royster, Voelker & Allen, P.C., who accumulated fees of $20,466.94 for representation from May 2013 to July 2015. The court noted that Heyl Royster’s rates were “in line with, and arguably lower than, the usual and customary rates charged by attorneys in this jurisdiction.” Continental later transferred Hamel Fire’s defense to two experienced trial lawyers at Mulherin, Rehfeldt & Varchetto, P.C., who amassed fees of $180,010.30 for their representation of Hamel Fire from April 2015 until all the underlying lawsuits were dismissed by October 2018. These fees, too, were based on Mulherin’s customary and reasonable hourly rates for partners and associates. Further, the court addressed the labor involved, benefit to the client, and complexity of the case. See Kaiser, 518 N.E.2d at 428. To that end, the court noted the extensive efforts demanded of Continental’s lawyers for the underlying lawsuits with two persisting for nearly six years and a third for more than three years. As the court noted, those matters “involved significant discovery and motion practice, mediation, extensive review of medical records, and accident reconstruction services.” As to the “degree of responsibility required” of the lawyers, id., the district court noted how the retained lawyers “took on full responsibility in the management of the No. 20-2962 21 [underlying lawsuits], including litigation strategy and discovery.” Likely attributable to hard work of its lawyers, the court also acknowledged that “Hamel Fire reaped significant benefits from the defense provided,” another factor suggesting the reasonableness of the fees. Abellan, 948 F.3d at 835. In fact, Hamel Fire had been released from each of the underlying lawsuits and avoided having to pay significant contributions to the settlements in those suits. Country Mutual does not expressly challenge these findings. Finally, as to complexity, Kaiser, 518 N.E.2d at 428, the court acknowledged that the underlying lawsuits were “more complex than a typical motor vehicle collision case” because there were substantial injuries that “required significant medical record review and analysis, several depositions, and forensic accident reconstruction,” and because of the complicated interplay between the private individuals, insurers, and municipal entities involved. Based on potential monetary impact alone, the sizable liability in question elevated this to a high-stakes case. On appeal, Country Mutual baldly asserts there was “nothing complex” about vicarious liability for “the operator of a vehicle involved in an automobile accident.” Country Mutual, however, fails to specifically address any of the district court’s considerations. At a minimum, Country Mutual has not explained why the court abused its discretion in appreciating the above complexities. Based on the district court’s comprehensive examination of the Illinois factors relevant to attorney’s fees and defense costs, and Country Mutual’s advancement of weak arguments to challenge this analysis, we hold the district court did not abuse its discretion and affirm the district court’s award of $240,146.18 in attorney’s fees and defense costs. As Country 22 No. 20-2962 Mutual makes no challenge to the district court’s award of pre-judgment interest of $10,394.72, we affirm the district court’s entire award of $250,540.90.