Court Opinion

ID: 213766
Source: CourtListenerOpinion
Date Created: 2011-04-01 15:34:59+00
Date Added: 2024-06-11T17:28:17.125968
License: Public Domain

United States Court of Appeals
      for the Federal Circuit
              __________________________

                  ESTHER HALL,
                 Petitioner-Appellant,
                           v.
      SECRETARY OF HEALTH AND HUMAN
                 SERVICES,
             Respondent-Appellee.
              __________________________

                      2010-5126
              __________________________

    Appeal from the United States Court of Federal
Claims in case no.02-VV-1052, Judge Lynn J. Bush.
               __________________________

                 Decided: April 1, 2011
              __________________________

   RICHARD GAGE, Richard Gage, P.C., Cheyenne, Wyo-
ming, argued for petitioner-appellant.

    ANN D. MARTIN, Trial Attorney, Torts Branch, Civil
Division, United States Department of Justice, of Wash-
ington, DC, argued for respondent-appellee. With her on
the brief were TONY WEST, Assistant Attorney General,
TIMOTHY P. GARREN, Director, MARK W. ROGERS, Deputy
Director, and CATHARINE E. REEVES, Assistant Director.
               __________________________
HALL   v. HHS                                             2

  Before BRYSON, GAJARSA, and MOORE, Circuit Judges.
GAJARSA, Circuit Judge.
    Esther Hall appeals from a final decision from the
United States Court of Federal Claims (“Claims Court”),
which affirmed the special master’s award of attorneys’
fees under 42 U.S.C. § 300aa-15 of the National Childhood
Vaccine Injury Act of 1986 (“Vaccine Act”). The issue
before us is whether the special master erred in awarding
attorneys’ fees at the local hourly rate instead of the
forum hourly rate. For the reasons discussed below, we
hold that the special master properly awarded attorneys’
fees at the local hourly rate, and we affirm the Claims
Court’s decision.
                       BACKGROUND
     Hall was awarded compensation under the Vaccine
Act for an injury to her shoulder caused by a hepatitis B
vaccination. Hall v. Sec’y of Health & Human Servs., 93
Fed. Cl. 239, 241 (2010) (“CFC Op.”). The Vaccine Act
“established a Federal ‘no-fault’ compensation program
under which awards can be made to vaccine-injured
persons quickly, easily, and with certainty and generos-
ity.” H.R. Rep. No. 99-908, at 3 (1986), reprinted in 1986
U.S.C.C.A.N. 6344. Where, as here, the petitioner obtains
compensation, she is entitled to attorneys’ fees and costs
pursuant to § 300aa-15(e), the amount of which is deter-
mined by the special master. 1
    Generally, attorneys’ fees are awarded at the forum
hourly rate. This court, however, created an exception to
this general rule in Avera v. Secretary of Health & Human

   1    Even if the petitioner does not prevail, the special
master may still award attorneys’ fees and costs so long
as there was a reasonable basis for the suit and the suit
was brought in good faith. 42 U.S.C. § 300aa-15(e).
3                                                HALL   v. HHS

Services, 515 F.3d 1343 (Fed. Cir. 2008), for cases arising
under the Vaccine Act. In Avera, this court held that
where the bulk of the work is performed outside the forum
and there is a “very significant difference” between the
local hourly rate and the forum hourly rate, attorneys’
fees should be awarded at the local hourly rate. Id. at
1349 (quoting Davis Cty. Solid Waste Mgmt. & Energy
Recovery Special Serv. Dist. v. U.S. Envtl. Prot. Agency,
169 F.3d 755, 758 (D.C. Cir. 1999)). Applying this excep-
tion ensures that attorneys are awarded reasonable
compensation for their work and more appropriately
reflects the purpose of a fee-shifting statute, especially in
cases arising under the no-fault Vaccine Act. This excep-
tion is known as the “Davis County exception,” as it was
adopted from a case having the same name issued by the
United States Court of Appeals for the District of Colum-
bia. See Davis Cty., 169 F.3d at 758. The dispute in this
appeal arises from the special master’s application of the
Davis County exception.
    In the present case, Hall initially requested
$83,400.34 in attorneys’ fees and costs for the work per-
formed by her attorney Richard Gage, who practices in
Cheyenne, Wyoming. CFC Op. at 242. Hall arrived at
this calculation based on Mr. Gage’s hourly rate from
August 2002 until April 2009, when her case terminated.
For legal work performed by Mr. Gage between August
2002 and December 2005, Hall requested fees based on an
hourly rate of $175 to $200. Id. at 242 n.4. For Mr.
Gage’s work from January 2006 until April 2009, Hall
requested fees based on an hourly rate of $360 to $410.
Id. at 242.
    The special master awarded Hall interim attorneys’
fees in the amount of $51,854.55. Id. The special master
calculated the interim attorneys’ fees using the lodestar
method, which requires “multiplying the number of hours
HALL   v. HHS                                            4

reasonably expended on the litigation times a reasonable
hourly rate,” and then adjusting that number up or down
based on other specific findings. Avera, 515 F.3d at 1347-
48 (internal citation and quotation marks omitted).
    The special master used an hourly rate of $175 to
$200 for August 2002 to December 2005 to calculate an
attorneys’ fees award of $28,393.95 for that time period.
Hall v. Sec’y of Health & Human Servs., Case No. 02-VV-
1052, 2009 WL 3094881, at *4 (Fed. Cl. Spec. Mstr. July
28, 2009) (“Interim Special Master Op.”). Although the
parties disputed the appropriate hourly rate for Mr.
Gage’s work between January 2006 and April 2009, the
special master awarded attorneys’ fees based on an hourly
rate of $219 to $239—the lowest amount that would be
awarded—for a total of $23,461.30 in fees. Id.
    In his final decision, the special master awarded Hall
an additional $22,018 in attorneys’ fees, which were
calculated using the local, instead of forum, hourly rates.
Hall v. Sec’y of Health & Human Servs., Case No. 02-VV-
1052, 2009 WL 3423036, *1 (Fed. Cl. Spec. Mstr. Oct. 6,
2009) (“Final Special Master Op.”). The special master
applied the Davis County exception because Mr. Gage did
not perform any work related to this case in Washington,
D.C. and the local and forum hourly rates were very
significantly different. Id. at *20, *28. The special mas-
ter compared Mr. Gage’s local hourly rate of $220 to $240
with his forum hourly rate of $350; the forum hourly rate
was 59 percent greater than the local hourly rate. Id. at
*20-21, *26. The special master found that this was a
very significant difference based on three Vaccine Act
cases and one Clean Air Act case. In those cases, the
difference between the local and forum hourly rates
ranged from 46 to 60 percent. Id. at *20-21. Because the
difference here—59 percent—was within that range, the
5                                               HALL   v. HHS

special master found that these rates, too, were very
significantly different. 2 Id.
    Hall was dissatisfied with this award, however, and
appealed the special master’s final decision to the Claims
Court. She requested an additional $11,477.20 in attor-
neys’ fees for work performed from January 2006 to April
2009, but the Claims Court denied the request. 3 CFC Op.
at 250. The Claims Court rejected Hall’s argument that
Richlin Security Service Co. v. Chertoff, 553 U.S. 571
(2008), overruled the use of the Davis County exception.
The court upheld the special master’s determination that
“there is a very significant difference between local mar-
ket rates in Cheyenne and forum rates in Washington,
D.C.” CFC Op. at 245. The Claims Court also denied
Hall’s subsequent motion for reconsideration, which
claimed that the court had established a new rule of law
and had miscalculated the difference between the forum
hourly rate and the local hourly rate. Id. at 252-54. Hall
appeals, and we have jurisdiction pursuant to 28 U.S.C.
§ 1298(c).

    2    The special master relied on the decision in Ma-
sias v. Secretary of Health & Human Services, Case No.
06-VV-559, 2009 WL 1838979 (Fed. Cl. Spec. Mstr. June
12, 2009), which upheld a determination that local and
forum hourly rates differing by 59 percent were “very
significantly different.” This court recently affirmed the
Claims Court’s decision in Masias v. Secretary of Health &
Humans Services, 2010-5077, slip op. at 3 (Fed. Cir. Mar.
15, 2011).
    3    After the special master’s final decision, the par-
ties filed a joint motion requesting that the amount of the
award in the special master’s final decision be reduced to
$2,231.70 because the fee award failed to take into ac-
count his previous interim award of $23,461.30 for the
same time period. CFC Op. at 242.
HALL   v. HHS                                              6

                   STANDARD OF REVIEW
    This court “review[s] an appeal from the Court of Fed-
eral Claims in a Vaccine Act case de novo, applying the
same standard of review as the Court of Federal Claims
applied to its review of the special master’s decision.”
Broekelschen v. Sec’y of Health & Human Servs., 618 F.3d
1339, 1345 (Fed. Cir. 2010) (citation omitted). Under 42
U.S.C. § 300aa-12, the Claims Court may “set aside any
findings of fact or conclusion of law of the special master
found to be arbitrary, capricious, an abuse of discretion, or
otherwise not in accordance with law . . . .” Thus, we
review fact findings under the arbitrary and capricious
standard, discretionary rulings under the abuse of discre-
tion standard, and legal questions de novo under the “not
in accordance with the law” standard. Saunders v. Sec’y
of Health & Human Servs., 25 F.3d 1031, 1033 (Fed. Cir.
1994). Generally in cases under the Vaccine Act, “[i]f the
special master has considered the relevant evidence of
record, drawn plausible inferences and articulated a
rational basis for the decision, reversible error will be
extremely difficult to demonstrate.” Hines v. Sec’y of
Health & Human Servs., 940 F.2d 1518, 1528 (Fed. Cir.
1991).
                        DISCUSSION
    The essence of Hall’s appeal is to eliminate the Davis
County exception to the general rule that forum hourly
rates are used to calculate attorneys’ fees. First, she
reiterates her claim that the Supreme Court’s decision in
Richlin overruled the application of the Davis County
exception. Hall’s second attempt at eliminating the Davis
County exception is more circumspect. She asserts that
the very significant difference determination is a question
of law and that this court should set a percentage or
absolute dollar amount that constitutes such a difference.
7                                                HALL   v. HHS

She then makes the leap that the forum hourly rate
should be reduced so that it does not exceed the threshold
set by the court, thus ensuring counsel would never be
awarded attorneys’ fees at the local hourly rate. As
discussed below, neither of these arguments have merit.
                             I.
     Our recent decision in Masias v. Secretary of Health &
Humans Services, 2010-5077, slip op. at 8 (Fed. Cir. Mar.
15, 2011) disposes of Hall’s argument that Richlin pre-
vents the application of the Davis County exception to
Vaccine Act cases. In Masias, this court held that Rich-
lin’s “adoption of market rates for paralegal fees is not
contrary to Avera.” Id. Indeed, the statute in Richlin, 5
U.S.C. § 504(a)(1), specifically requires that attorneys’
fees be calculated at “prevailing market rates.” Neither
42 U.S.C. § 7607(f), the statute in Davis County, nor the
Vaccine Act have a similar limitation on the calculation of
attorneys’ fees. Thus, until Avera is overturned by the
Supreme Court or by this court sitting en banc, it remains
binding precedent. See Masias, slip op. at 8 (citing Bar-
clay v. United States, 443 F.3d 1368, 1373 (Fed. Cir.
2008); McAllister v. Sec’y of Health & Human Servs., 70
F.3d 1240, 1242 (Fed. Cir. 1995)).
                             II.
    Hall’s next attempt to eliminate the Davis County ex-
ception in Vaccine Act cases similarly fails. She alleges
that one part of the Davis County exception—the deter-
mination of whether the local and forum hourly rates are
very significantly different—is a question of law. Based
on this allegation, Hall urges the court to set a bright line
rule for what constitutes a very significant difference.
Hall then asks the court to establish a new requirement
that the forum hourly rate should be reduced so that the
forum hourly rate falls below the threshold of what consti-
HALL    v. HHS                                             8

tutes a very significant difference. 4 Thus, in Hall’s world,
the Davis County exception would never apply.
    As an initial matter, Hall essentially asks this court
again—albeit in a less direct manner—to overturn Avera’s
adoption of the Davis County exception by reducing
reasonable forum hourly rates to eliminate a very signifi-
cant difference. As explained supra, a panel of this court
cannot overturn another panel. See Barclay, 443 F.3d at
1373. This court declines to do so.
    More broadly, Hall’s assertion that the determination
of whether there is a very significant difference between
the local and forum hourly rates should be a question of
law is erroneous. Of the three categories of judicial
decisions—questions of law, questions of fact, and matters
of discretion, see Pierce v. Underwood, 487 U.S. 552, 558
(1988)—the standard of review for the determination of
reasonable attorneys' fees is abuse of discretion. See
Saxton ex. rel. Saxton v. Sec’y of Health & Human Servs.,
3 F.3d 1517, 1520 (Fed. Cir. 1993) (citation omitted) (“The
determination of the amount of reasonable attorneys’ fees
is within the special master’s discretion.”). Of course, a
special master’s failure to apply the Davis County excep-
tion where he or she has found that the bulk of the work
was performed outside the forum and the difference

    4   Hall provides the following example, see Pet’r’s Br.
14: assume the bright line rule states that local and forum
hourly rates are very significantly different if they are
more than $100 apart. Further assume that the local rate
is $240 and the forum rate is $350 per hour. Under Hall’s
proposal, the court should reduce the forum rate to $340
per hour so that it falls within the $100 threshold for
what constitutes a very significant difference. Thus,
attorneys’ fees would be awarded at the $340 per hour
rate.
9                                               HALL   v. HHS

between local and forum hourly rates is very significantly
different would be incorrect as a matter of law.
     This court’s decision to apply an abuse of discretion
standard is guided by the principles enunciated in Pierce,
where the Supreme Court found that the abuse of discre-
tion standard was appropriate for reviewing a district
court’s determination of attorneys’ fees under 28 U.S.C.
§ 2412(d)(1)(A). 487 U.S. at 559-63. The Court explained
that in deciding the appropriate standard of review, a
court should consider the language of the applicable law
and principles of “sound judicial administration.” Id. The
Court focused on the statutory language in 28 U.S.C.
§ 2412(d)(1)(A) that said attorneys’ fees must be awarded
“unless the court finds that the position of the United
States was substantially justified.” Id. (quoting 28 U.S.C.
§ 2412(d)(1)(A)). The Court reasoned that this language
“emphasizes [that] the fact determination is for the dis-
trict court to make, and thus suggests some deference to
the district court.” Id. Furthermore, the district court was
better positioned than the appellate court to decide
whether the Government’s position was “substantially
justified” because it was intimately familiar with all the
facts before it. Id. at 560; see Hensley v. Eckerhart, 461
U.S. 424, 437 (1983) (finding that the district court had a
“superior understanding of the litigation”). Finally, the
Court found that determining whether a position was
“substantially justified” is a “multifarious and novel
question” that would “likely profit from the experience
that an abuse-of-discretion rule will permit to develop.”
Pierce, 487 U.S. at 562. The Court concluded that based
on these considerations, an abuse of discretion standard
was appropriate. Id. at 563.
   Application of the Pierce factors to this case requires a
similar result. First, both 42 U.S.C. § 300aa-15(e) and the
Davis County exception require a detailed multi-
HALL   v. HHS                                            10

component determination by the special master. See
Pierce, 487 U.S. at 559. Section 300aa-15(e) states that
“the special master or court shall also award as part of
such compensation an amount to cover . . . reasonable
attorneys’ fees.” Thus, the statute leaves it to the special
master’s discretion to find what constitutes reasonable
fees. The Davis County exception requires a further
application of the special master’s findings to determine
whether or not there is a very significant difference
between local and forum hourly rates.
    The special master is also intimately familiar with the
facts necessary to make the very significant difference
determination. See Pierce, 487 U.S. at 560. In calculating
the local and forum hourly rates, the special master
assesses the reasonable hourly rate “prevailing in the
[forum or locally] for similar services by lawyers of rea-
sonably comparable skill, experience, and reputation.”
Avera, 515 F.3d at 1348 (quoting Blum v. Stenson, 465
U.S. 886, 896 n.11 (1984)). In making his determination,
the special master relies on declarations, previous compa-
rable litigation, and his or her own experience in similar
cases. See Saxton, 3 F.3d at 1521. Once the special
master determines the local and forum hourly rates, he
must compare them.         The special master is better
equipped to decide whether or not there is a difference
between the two rates and the degree of that difference,
as his or her “superior understanding of the litigation”—
something an appellate court lacks—is essential to this
determination. See Hensley, 461 U.S. at 437 (explaining
that attorneys’ fees determinations are “essentially fac-
tual matters”).
    Relatedly, setting a rule as to what constitutes a very
significant difference between local and forum hourly
rates would be stifling and impractical. See Pierce, 487
U.S. at 562. As explained above, making this determina-
11                                            HALL   v. HHS

tion is multifaceted and the experience of the special
master is invaluable to it. Special masters should, as in
this case, continue to rely on the evidence before them
and their own trial experience in similar litigations in
making such a determination.
    Here, the special master undertook a detailed analy-
sis of reasonable local and forum hourly rates in Vaccine
Act cases and other similar litigation. He also examined
previous Vaccine Act cases and a Clean Air Act case that
found the local and forum hourly rates were very signifi-
cantly different. The following chart lists the local and
forum hourly rates from those cases and the percentage
difference between them:
HALL   v. HHS                                          12

Case                   Local                Percentage
                                 Forum
                       Hourly               Difference
                                 Hourly
                       Rate      Rate

Sabella v. Sec’y of $300         $440       46%
Health & Human
Servs., Case No. 02-
VV-1627, 2008 WL
4426040 (Fed. Cl.
Spec. Mstr. Sept. 23,
2008) rev’d on other
grounds, 86 Fed. Cl.
201 (Fed. Cl. 2009)

                  WL $220        $350       59%
Masias, 2009
1838979

Rodriguez v. Sec’y of $450       $275       60%
Health & Human
Servs., Case No. 06-
VV-0559, 2009 WL
2568468 (Fed. Cl.
Spec. Mstr. July 27,
2009)

            Mountain $225        $360       60%
Rocky
Clean Air Action v.
Johnson, Case No.
05-CV-1992,    2008
WL 1885333 (D.D.C.
Jan. 28, 2008)

As the chart shows, the local and forum hourly rates in
those cases ranged from 46 to 60 percent. Here, the
difference between Mr. Gage’s local hourly rate of $220 to
13                                             HALL   v. HHS

$240 and his forum hourly rate of $350 was 59 percent,
which the special master found to be very significant. The
special master’s attorneys’ fees decision was within the
parameters of the cases on which he relied and was not an
abuse of discretion.
                      CONCLUSION
    For the foregoing reasons, we affirm the decision of
the Claims Court.
                      AFFIRMED
                         COSTS
     No costs.