Opinion ID: 2782821
Heading Depth: 1
Heading Rank: 4

Heading: kfa is entitled to the full award of attorney’s

Text: FEES. Finally, Mid-Continent argues that, even if KFA wins on the coverage issue and is therefore entitled to attorney’s fees under Tex. Civ. Prac. & Rem. Code § 38.001 for breach of the insurance contract, the district court erred in awarding fees based on the contingency fee agreement between KFA and its attorneys minus a reduction for time spent outside of the breach of insurance contract claim, which represents a total recovery outside of costs of 33.8%. 31 Mid-Continent argues that Texas requires lodestar evidence for attorney’s fees. That is not accurate. Texas courts permit otherwise reasonable contingency fee awards under § 38.001. Interpreting Texas law, the Fifth Circuit permitted the imposition of a contingency fee in Mathis v. Exxon Corp., 302 F.3d 448 (5th Cir. 2002): First, there is a rebuttable presumption of reasonableness for fees that are “usual” or “customary.” Tex. Civ. Prac. & Rem. Code § 38.003 (Vernon 2002). Second, where the fees are tried to the court, as they were in this case, the statute authorizes the judge to take judicial notice of the “usual and customary fees” and the contents of the case file. Id. at § 38.004. Texas courts have upheld fee awards using these presumptions where the attorneys had a contingent fee arrangement. Laredo Indep. Sch. Dist. v. Trevino, 25 S.W.3d 263 (Tex. App.—San Antonio The district court awarded a net fee of $1,091,362.72, compared to the underlying 31 judgment of $3,231,084.00, or approximately 33.8% of the judgment. 22 Case: 14-50649 Document: 00512950594 Page: 23 Date Filed: 02/26/2015 No. 14-50649 consolidated with No. 14-50673 2000, review denied) (40% contingency fee); European Crossroads’ Shopping Ctr., Ltd. v. Criswell, 910 S.W.2d 45, 58–59 (Tex. App.—Dallas 1995, writ denied) (upholding jury award of 35% based only on attorney’s own testimony). Plaintiffs’ attorneys supported their fees by submitting an affidavit drafted by lead counsel and an affidavit of an attorneys’ fees expert. Exxon countered by challenging the reasonableness of the total award. Under Texas law, the two affidavits, combined with the presumption of reasonableness and the court’s ability to use judicial notice to guide the reasonableness finding is enough for us to conclude that the district court did not abuse its discretion in awarding fees as contemplated by plaintiffs’ contingency fee contract. 32 The Texas Supreme Court recently noted that lodestar evidence is not required for contingency fee awards but is required if a claimant wants to go above the contingency fee calculation: In addition to the lodestar method, the attorney’s fee affidavit also indicates the Griffins and their attorneys agreed to a 35% contingency fee arrangement, which the affidavit claims is reasonable and customary for such a suit. Even if supporting evidence is not required for the contingency fee method of proof (as it is for the lodestar method), the contingency fee method cannot support the trial court’s fee award here because the final judgment awarded no monetary relief except for attorney’s fees. Because the contingency fee method cannot support the trial court’s fee award, and no legally sufficient evidence supports the award under the lodestar method, we remand to redetermine attorney’s fees. 33 Mid-Continent’s argument rests entirely on the proposition that KFA failed to submit lodestar evidence. Because Texas law does not require lodestar evidence for contingency fee arrangements and because Mid-Continent has not 32 Id. at 462 (footnote omitted). 33 Long v. Griffin, 442 S.W.3d 253, 256 (Tex. 2014) (emphasis added). 23 Case: 14-50649 Document: 00512950594 Page: 24 Date Filed: 02/26/2015 No. 14-50649 consolidated with No. 14-50673 shown that the fee is unreasonable, we cannot say that the district court abused its discretion in awarding the fee.