United States ex rel. Higgins v. Bos. Sci. Corp.

United States of America and the State of California, ex rel. Steven Higgins, Plaintiff, v. Boston Scientific Corporation, Defendant.

No. 11-cv-2453 (JNE/TNL)

United States District Court, D. Minnesota

September 3, 2021

Daniel R. Miller and Jonathan Z. DeSantis, Walden Macht & Haran LLP, 2001 Market Street, Suite 2500, Philadelphia, PA 19103 Joy P. Clairmont, Susan S. Thomas, and William H. Ellerbe Berger Montague PC, 1818 Market Street, Suite 3600 Philadelphia, PA 19103; and E. Michelle Drake, Berger Montague PC, 43 Southeast Main Street, Suite 505 Minneapolis, MN 55414 (for Relator Steven Higgins); and

Frederick Robinson and Lesley Reynolds, Reed Smith LLP, 1301 K Street Northwest, Suite 1100 - East Tower, Washington, DC 20005; Caitlin Chambers, Reed Smith LLP, 811 Main Street, Suite 1700, Houston, TX 77002; and Allison Lange Garrison, Norton Rose Fulbright U.S. LLP, 60 South Sixth Street, Suite 3100, Minneapolis, MN 55402 (for Defendant Boston Scientific Corporation).

ORDER

Tony N. Leung United States Magistrate Judge

I. INTRODUCTION

This matter is before the Court, the Honorable Tony N. Leung, on Relator's Fee Petition Arising from Sanctions Order (ECF No. 379). Following the Court's Order granting in part and denying in part Relator's Motion for Sanctions (ECF No. 354), which awarded Relator certain costs and fees, the parties informed the Court that they were unable to resolve the issue of how much Relator should be awarded in costs and fees. (See Case Mgmt. Order, ECF No. 378.) The Court set a briefing schedule. (Id.) Based on the following, the Court grants in part and denies in part Relator's petition, and awards Relator reasonable costs and fees in the amount of $68, 431.48.

II. BACKGROUND

A complete procedural history of Relator's Motion for Sanctions (ECF No. 281) (hereinafter “Sanctions Motion”) can be found in a previous order (hereinafter “Sanctions Order”). See United States ex. rel. Higgins v. Boston Sci. Corp., No. 11-cv-2453 (JNE/TNL), 2020 WL 968218, at *1 (D. Minn. Feb. 28, 2020).^[1] The undersigned heard oral argument on the Sanctions Motion after a prior order (hereinafter “Oct. 16 Order”) awarding sanctions was vacated by the Honorable Joan E. Ericksen, District Judge for the United States District Court for the District of Minnesota. See Id. (“The Oct. 16 Order was vacated to permit for oral argument and reconsideration . . . [the order vacating the Oct. 16 Order] made no decision as to the merits of the Oct. 16 Order.” (citations omitted)).

The Sanctions Order also details the factual history of the case, and the bases for the Sanctions Motion. Id. at *1-8. The Court ultimately determined that Defendant violated Rule 26 by failing to disclose timely certain witnesses in its initial disclosures. Id. at *10-11; see also Id. at *13 (“Boston Scientific's Rule 26(a)(1) disclosure failures were harmful and prejudicial to Relator.”). The Court imposed various sanctions on Defendant. Id. at *13-15. Relevant to the fee petition (hereinafter “Fee Petition”) currently at issue, the Court ordered Defendant “to pay all Relator's reasonable costs and attorney's fees related to briefing and arguing the sanctions motion.” Id. at *15 (citing Fed.R.Civ.P. 37(c)(1); Fed.R.Civ.P. 37(b)(2)(A).) The Court further noted, however, that while it would award Relator “all his reasonable costs and fees for having to bring the sanctions motion, ” it would not award costs and fees related “to past or future discovery.” Id.

On August 13, 2021, Judge Ericksen granted Defendant's Motion for Summary Judgement, ending this litigation. (ECF No. 588.) The matter of the Fee Petition, however, remains.

This Court retains jurisdiction to issue an order awarding costs and fees under Rule 37. Both federal statutes and the Federal Rules of Civil Procedure guide magistrate judges in the scope of their authority. See 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72. The authority of a magistrate judge to determine a matter by way of an order turns generally upon whether the motion is considered “dispositive” or “nondispositive.” Robinson v. Eng, 148 F.R.D. 635, 639 (D. Neb. 1993) (citing 28 U.S.C. § 636(b)(1)(A)). As the monetary amount of the sanction award does not dispose of a claim, it is nondispositive and the Court will rule by way of an order. See Smith v. Bradley Pizza, Inc., No. 17-cv-2032 (ECT/KMM), 2019 WL 2448575, at *10-11 (D. Minn. June 12, 2019) (reviewing a magistrate judge's order awarding fees pursuant to Rule 37(b)(2)).

“Although Section 636(b)(1)(A) speaks in terms of ‘pretrial' matters, courts have consistently found that a magistrate judge has jurisdiction to issue a post-trial (or post-dismissal) order on a motion for sanctions where the basis for sanctions arose in the case's preliminary stages, unless the nature of the sanction is dispositive of a party's claim or defense.” Taverna Imports, Inc. v. A&M Wine & Spirits, Inc., No. 15-24198-CIV-LENARD/GOODMAN, 2018 WL 11227736, at *4 (S.D. Fla. Dec. 20, 2018) (collecting cases); see also BankAtlantic v. Blythe Eastman Paine Webber, Inc., 12 F.3d 1045, 1048 (11th Cir. 1994) (discussing Rule 37 sanctions awarded post judgment); Merrit v. Int'l Bhd. of Boilermakers, 649 F.2d 1013, 1018 (5th Cir. 1981) (“Since discovery issues are by definition pretrial matters, the magistrate possessed authority under 28 U.S.C. § 636(b)(1)(A) to assess reasonable expenses and attorney's fees under Rule 37(a)(4), even after judgment was rendered in the case.”). It also remains to be seen whether this case will be appealed to the Eighth Circuit. Even if it is, however, the Eighth Circuit is one of several circuits to “have held that a district court retains jurisdiction over ‘collateral' matters, such as . . . motions requesting attorney's fees, even though final judgment on the underlying action has been entered.” Robinson, 148 F.R.D. at 638 (collecting cases); cf. American Modern Home Ins. Co. v. Thomas, No. 4:16 CV 215 CDP, 2019 WL 3976355, at *8-10 (E.D. Mo. Aug. 22, 2019) (discussing and ruling on a sanctions motion related to discovery violations post-trial). The Court thus proceeds with analyzing the Fee Petition.

III. ANALYSIS

Relator seeks a total of $114, 086.88 in fees, expenses, and so-called “fees-on-fees.” Relator seeks $73, 194.50 for fees and costs^[2] related to the Sanctions Motion. (Mem. in Supp. at 8, ECF No. 380.) In addition, Relator seeks $40, 892.38 for so-called “fees-on-fees” incurred in connection with time expended preparing the Fee Petition and replying to Defendant's memorandum in opposition to the Fee Petition. (See Miller Decl. ¶¶ 7 & 11, ECF No. 396.)

Defendant challenges Relator's Fee Petition, arguing that the requested hourly rates are unreasonable; the hours expended by Relator's counsel are unreasonable; the requested costs and expenses are unreasonable, excessive, and inadequately documented; and the lodestar should be reduced for Relator's lack of success on the motion. (See generally Mem. in Opp'n, ECF No. 387.) It argues that Relator is entitled to no more than $32, 000. (Id. at 30.)

“Rule 37 sanctions must be applied diligently both to penalize those whose conduct may be deemed to warrant such a sanction, and to deter those who might be tempted to such conduct in the absence of such a deterrent.” NutriQuest, LLC v. AmeriAsia Imports LLC, No. 18-cv-390 (NEB/KMM), 2018 WL 5785952, at *1 (D. Minn. Nov. 5, 2018) (quoting Roadway Exp., Inc. v. Piper, 447 U.S. 752, 763-64 (1980)) (additional citation omitted). In this case, the Court sanctioned Defendant by ordering it to pay Relator's reasonable costs and attorney's fees related to briefing and arguing the Sanctions Motion. Higgins, 2020 WL 968218, at *15.

A. Fees and Expenses Related to the Sanctions Motion

Relator initially presented a demand to Defendant of $81, 429.88 in fees and expenses for 128.5 hours of work. (Mem. in Supp. at 5-6; see also Ex. 2 to Clairmont Decl., ECF No. 383-2.) This included time for briefing the issues in the August 2019 status letter to the Court, preparation of the Sanctions Motion, responding to Defendant's objections to the Oct. 16 Order, and oral argument before the undersigned. (Id. at 4-6.) After a breakdown in negotiations, the Court ordered briefing on the issue. (ECF No. 378.) Below is a copy of a chart supporting this total provided by Relator's counsel:

Timekeeper

Position

Years of Experience

Rate

Hours

Total

David Filbert

Paralegal

24

$345.00

1.7

$586.50

Dan Miller

Partner

28

$773.82

39.1

$30, 256.50 ^[3]

Joy Clairmont

Partner

22

$645.00

2.5

$1, 612.50

Jonathan DeSantis

Associate

7

$465.00

55

$25, 575.00

Susan Thomas

Partner

40

$790.00

19.4

$15, 326.00

William Elleibe

Associate

8

$510.00

10.8

$5, 508.00

NET

128.5

$78, 864.50

EXPENSES

$2, 565.38

TOTAL

$81, 429.88

(Ex. 2 to Clairmont Decl.; but see Clairmont Decl ¶ 12, ECF No. 383 ("As shown in Exhibits 1 and 2 the total lodestar incurred . . . for work related to the Sanctions motion, based on current rates, amounts to $78, 864.38.")

Relator's counsel states they have exercised billing judgment by reviewing their time entries and voluntarily reducing by 50% entries which counsel for both parties identified as vague, unrelated to the Sanctions Motion, or included time related to the Sanctions Motion as well as other issues included in the August status letter sent to the Court. (Mem. in Supp. at 22-24.) Relator now seeks $73, 194.50 "for the fees and expenses incurred in relation to the Sanctions Motion.”^[4] (Relator's Mem. in Supp. at 8; see also Id. at 24.^[5])

District courts have “broad discretion” in awarding attorney's fees. Hanig v. Lee, 415 F.3d 822, 825 (8th Cir. 2005). “Where attorney fees are appropriate courts typically use the ‘lodestar' method for...