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Lodestar Doesn’t Apply to Conditional Appellate Fees

The Texas Attorney’s Fee Blog*

By John W. Bridger & David A. Kirby

Just when I was preparing to have an academic, yet scintillating, discussion regarding the argument that appellate courts should render when they reverse cases for insufficient evidence of attorneys’ fees, which was certain to stir multiple contentious debates around the latte bar, the Texas Supreme Court held that the fee proponent need not comply with lodestar. See Yowell v. Granite Operating Co., No. 18-0841, 2020 Tex. LEXIS 425 (Tex. May 15, 2020). Since this opinion (a) comes from the Texas Supreme Court and (b) departs from what David Kirby and I write about appellate fee proof, I decided this actual holding preempted the theoretical ruminations.

In somewhat of a side issue in a case involving a disputed mineral lease interest, the Texas Supreme Court, in an opinion authored by Justice Busby, acknowledged:

We have not previously addressed how this lodestar analysis may affect the evidence needed to support a contingent award of fees that have not yet been incurred. . . . As we explained in Rohrmoos Venture, however, “[i]t should have been clear from our opinion[] in El Apple” that the lodestar analysis applies to situations “in which an objective calculation of reasonable hours worked . . . can be employed.” 578 S.W.3d at 498.

Id. at *36–37. In rejecting the argument that appellate fees should be proved with the same specificity as trial fees, the supreme court explained that lodestar cannot be employed when projecting appellate fees because those hours have not been worked. See id. at *37. Additionally, “there is no certainty regarding who will represent the appellee in the appellate courts, what counsel’s hourly rate(s) will be, or what services will be necessary to ensure appropriate representation in light of the issues the appellant chooses to raise.” Id.

Continue reading “Lodestar Doesn’t Apply to Conditional Appellate Fees”

Strong Pipkin Bissell & Ledyard, L.L.P. Celebrates its 85th Anniversary

Strong Pipkin 85th AnniversaryIn 1918, Beeman Strong became a judge on the Texas Commission of Appeals, which was the forerunner of today’s Texas Supreme Court.  In the 1920s, he became General Counsel of the Yount-Lee Oil Company headquartered in Beaumont, Texas.  In 1935, the Yount-Lee Oil Company was purchased and merged into the Stanolind Oil Company.

As the Yount-Lee Oil Company was dissolved, Beeman decided to enter private practice in Southeast Texas and partnered with his son, Ewell, and A. D. Moore to form the law firm of Strong Moore & Strong.  With a wealth of oil company legal experience, the firm quickly established itself as a valuable resource in the oil industry and for growing companies in Southeast Texas.

In 1954, longtime Beaumont attorney Charles Pipkin joined the firm, and the Strong Pipkin name was born.  Eighty-five years later, Strong Pipkin has withstood the test of time, having prospered during ten different decades.

While the start to the current decade has been challenging, Strong Pipkin will weather this storm, as it has many others, to remain a trusted destination for legal excellence of its local, regional, national, and international corporate and individual clients.

The “Traditional Method” is Dead; Long Live Lodestar

The Texas Attorney’s Fee Blog*

By John W. Bridger & David A. Kirby

John Bridger hiking with a backpack full of attorney’s fee cases to review.

In the musical Fiddler on the Roof, Teyve opens the play extolling the virtues of tradition and then spends the remainder struggling with and lamenting the erosion of those traditions. A similar scene has unfolded in Texas over the years with respect to the prosecution of attorneys’ fee claims.  To Teyve’s likely chagrin, the “traditional method” for evidencing recoverable attorneys’ fees is dead—the Texas Supreme Court having put a proverbial nail in that coffin last year—and the lower courts are embracing the new standard. Texas attorneys should understand how times have changed.

Historically in Texas, attorneys could prove up attorneys’ fees by either the “traditional method” or the lodestar method.

Under the “traditional method,” the attorney proved up his or her fees by testifying to some, but not necessarily all, of the Arthur Andersen factors and merely stating that his or her total fees sought were reasonable and necessary. See Arthur Andersen & Co. v. Perry Equipment Corp., 945 S.W.2d 812, 818 (Tex. 1997). Arguably, this eliminated the need to testify about hours billed, rates charged, and specific tasks performed (although one might give general descriptions of work performed).  Moreover, there was arguably no requirement to submit one’s detailed billing records.

Under lodestar, on the other hand, one must detail the hours spent on specific tasks and rates charged as well as proffer testimony regarding the Arthur Andersen or Johnson factors. See Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir. 1974).

Continue reading “The “Traditional Method” is Dead; Long Live Lodestar”

COVID-19 Update: Strong Pipkin Continues to Assist Clients without Interruption

To Our Clients and Friends of the Firm:

Strong Pipkin is closely monitoring developments related to COVID-19 and we are committed to the well being of our staff and their families. To our clients, rest assured that despite the unprecedented and evolving circumstances in which we find ourselves, you remain a top priority. We continue to provide the exceptional service that you expect. Our firm is fully operational and our Beaumont and Houston offices continue to service client needs without interruption.

We are closely monitoring the status of the various courts in which we practice to insure that we meet all deadlines and participate in all proceedings that are going forward. Courts have largely restricted in-person access, but we are prepared to participate in hearings both telephonically and through video conferencing.

For more than 85 years, Strong Pipkin has represented and advised clients. Some of those years involved challenging world events and economic uncertainty. Rest assured that we will continue to adapt as this current crisis evolves and circumstances change to ensure that our clients’ needs are met.

Please do not hesitate to contact us with any questions or needs on any matter. We value and appreciate the trust you place in us.

Stay healthy and safe.

Strong Pipkin Bissell & Ledyard, L.L.P.

Strong Pipkin Obtains Court of Appeals Victory for its Client with Affirmation of Take Nothing Judgment

The Ninth Court of Appeals in Beaumont issued an opinion and judgment affirming the trial court’s judgment that Plaintiff recover nothing from Strong Pipkin’s client, an oil and gas producer.

The case involved several properties purchased by Plaintiff at a foreclosure sale.  The prior owners of the properties entered into mineral leases with Strong Pipkin’s client, wherein they received royalty payments.  Strong Pipkin’s client pooled several leases together and drilled two wells.  The two wells were located on properties within the pooled unit but not on the properties obtained by the Plaintiff.  After Plaintiff obtained the properties at a foreclosure sale, the Plaintiff refused to enter into a separate lease to collect the royalty payments previously paid to the former owners, arguing that because he is not a party to the lease he is entitled to receive a working interest (a percentage of total profit) in the two wells.

At trial, Strong Pipkin attorney Greg Dykeman successfully argued that Wagner & Brown, Ltd. v. Sheppard, 282 S.W.3d 419 (Tex. 2008) does not support the proposition that any unleased property within a pooled unit has a right to receive a proportionate share of total profits of the pooled unit. In the subsequent appeal, Strong Pipkin attorney Dan Mabry successfully argued that Plaintiff is not entitled to a percentage profit in the pooled unit citing the Rule of Capture and distinguishing Sheppard.  Unlike in Sheppard, the Plaintiff in this case was not the mineral owner of the property on which the wells were drilled, and citing the Rule of Capture, Strong Pipkin argued that Plaintiff is not entitled to royalty payments because Plaintiff did not enter into a mineral lease with the oil & gas producer.

The Ninth Court of Appeals agreed with Strong Pipkin’s analysis and affirmed the trial court’s Judgment that the Plaintiff take nothing from Strong Pipkin’s client.  A copy of the opinion can be found at 2020 Tex. App. LEXIS 443 or 2020 WL 238538.

Strong Pipkin recognized – 2020 “Best Law Firms”

Strong Pipkin is included in the 2020 Edition of U.S. News – Best Lawyers “Best Law Firms.”  Firms are recognized for professional excellence with consistently impressive ratings from clients and peers.  Firms that received a tier designation reflect the highest level of respect a firm can earn among other leading lawyers and clients from the same communities and practice areas.  Strong Pipkin is ranked in the Metropolitan Tier 1 category in the following practice areas:

Beaumont

Litigation – Construction
Mass Tort Litigation / Class Actions – Defendants
Personal Injury Litigation – Defendants
Product Liability Litigation – Defendants

Houston

Commercial Litigation
Litigation – Environmental
Litigation – Labor & Employment
Mass Tort Litigation / Class Actions – Defendants
Personal Injury Litigation – Defendants
Product Liability Litigation – Defendants

Mike Hendryx receives the Exceptional Service Award

Partner Mike Hendryx receives the Exceptional Service Award from the Texas Association of Defense Counsel at its Annual Meeting. The Award recognized his efforts during the last legislative session to pass House Bill 1693, which returned fairness and balance to a key process used in civil trials.

John Bridger Presents Attorneys’ Fees Paper at HBA CLE Event

Strong Pipkin senior partner John Bridger spoke on the topic “Maximizing Prosecuting or Defending Your Attorneys’ Fees Claim in Texas” at a Houston Bar Association Continuing Legal Education event presenting a paper he wrote along with David Kirby, a Strong Pipkin senior associate.

A video of the presentation can be viewed at https://vimeo.com/340743062/2bf6a98363 and HBA members may receive CLE credit by accessing the presentation at https://apps.hba.org/cle-videos/all/6/.

John and David are rapidly becoming two of the most prolific attorneys’ fees authors in Texas having also written Recovering Attorney’s Fees in Federal CourtFor The Defense, March 2019, Prosecuting and Defending Attorneys’ Fees in Texas: A Primer (2nd ed.) for the Jefferson County Bar Association in 2018, and Prosecuting and Defending Attorneys’ Fees in Texas: A Primer (1st ed.) for the Texas Association of Defense Counsel in 2017. As a result, they have also been retained as attorneys’ fees experts by clients both prosecuting and defending attorneys’ fees claims.

Strong Pipkin Partner Mike Hendryx Testifies before the Texas Senate in Favor of Changes to CPRC Section 18.001

Strong Pipkin Partner Mike Hendryx on the Floor of the Texas Senate after testifying in support of HB 1693, a bill that made needed changes to the affidavit process provided under Texas Civil Practices and Remedy Code section 18.001.

Texas Civil Practice and Remedies Code section 18.001 was intended to provide a cost saving measure at trial by allowing a plaintiff to submit proof by affidavit that the amount he or she was charged for a service was reasonable at the time and place that the service was provided and that the service was necessary. If the responding party does not agree, Section 18.001 allows that party to serve a counter affidavit contesting the reasonableness of the charges or the necessity of the services.  Unless struck, the counter affidavit essentially negates the evidentiary effect of the initial affidavit.

Over time, practical problems arose regarding the timing of the affidavits and counter affidavits, as well as the breadth of what proof was established by the affidavit.

As to timing, in some instances the plaintiff was serving the affidavit with the Original Petition, requiring the defendant to respond within thirty days of service. That meant reviewing the evidence and then hiring an expert to controvert the initial affidavit within the first thirty days of the lawsuit. On the other hand, some plaintiffs waited until thirty days before trial to file and serve the initial affidavits, forcing the defendant to respond on the eve of trial.

As to what the affidavits established, some courts were taking the position that the initial affidavit, if unchallenged, was binding on the jury and could not be disputed at trial.  What had started out as a cost saving vehicle for undisputed charges, had turned into a very unfair process for the defendant.

HB 1693, passed in 2019, made much needed changes to Section 18.001.  The amendments primarily address two issues:

(1)     The deadlines to file the initial affidavits were changed and the deadlines for counter affidavits were shifted to give more time to respond, and

(2)    The amendment made it clear that the affidavit process did not establish proximate cause; that issue remained in the hands of the jury and could be addressed by experts.

The amendments to Section 18.001 also built in flexibility.  It allows the parties to agree on different deadlines or with leave of court, set different deadlines.