MARCIA S. KRIEGER, District Judge.
Relator Bobby L. Maxwell brought this suit on behalf of the United States, pursuant to the False Claims Act ("FCA"), 31 U.S.C. § 3729 et seq., alleging that Defendant Kerr-McGee Oil & Gas Corp. filed false royalty reports with the Minerals Management Service ("MMS") concerning oil and gas leases on government land from 1999 to 2003. The false reports were discovered by Maxwell in his role as an auditor with the MMS, as part of an audit of the Defendant's royalty statements. Although the MMS disagreed with Maxwell's conclusions that the Defendant's royalty statements constituted false claims, Maxwell elected to bring this action as a relator.
The case was tried to a jury in January 2007, and the jury returned a verdict in favor of the Plaintiff, awarding $7,555.886.26 in damages. On September 16, 2010, 2010 WL 3730894, the Court entered judgment in favor of the Plaintiff
In his pending application, Maxwell seeks $2,178,632.25 in attorneys' fees pursuant to 31 U.S.C. § 3730(d)(2) for the work of the three law firms that have represented him during this action. (
The Defendant opposes the application, arguing that the attorneys' fees award should be reduced to $1.1 million to account for (1) the fact that the attorneys' fees sought are grossly disproportionate to the amount that Maxwell would recover; and (2) the limited degree of success achieved by Maxwell in the action. (
Although the judgment in this action has been appealed, this Court retains jurisdiction to rule on this application for attorneys' fees, expenses, and costs. See McKissick v. Yuen, 618 F.3d 1177, 1196 (10th Cir.2010) ("[A]n award of attorney fees . . . is perhaps the paradigmatic example of a collateral issue a district court may entertain after an appeal has been taken to th[e] court [of appeals]."); Bell v. Bd. of Cnty. Comm'rs of Jefferson Cnty., 451 F.3d 1097, 1101 n. 2 (10th Cir.2006) ("If fees are sought in the district court on the basis of a judgment that has been appealed, the court of appeals and district court each have jurisdiction over the distinct matters before them."); Lancaster v. Indep. Sch. Dist. No. 5, 149 F.3d 1228, 1237 (10th Cir.1998) ("Although filing notice of appeal generally divests the district court of jurisdiction over the issues on appeal, . . . [a]ttorney's fees awards are collateral matters over which the district court retains jurisdiction.").
II. Attorneys' Fees
31 U.S.C. § 3730(d)(2) provides that, in a qui tam action in which the United States does not intervene, a prevailing relator shall receive his reasonable attorneys' fees and costs. 31 U.S.C. § 3730(d)(2). See also United States ex rel. Ritchie v. Lockheed Martin Corp., 558 F.3d 1161, 1172 (10th Cir.2009) (stating that the statute provides for an award of
Maxwell has submitted declarations and exhibits from his attorneys detailing the number of hours they spent on the action and their hourly rates. (
The Defendant argues that the total amount of fees sought is unreasonable, however, for two reasons. First, the Defendant contends that they are excessive when considered in light of the contingent fee agreement between Maxwell and his attorneys. (Id.
The existence of a contingent fee agreement between Maxwell and his counsel does not justify reducing the lodestar amount of attorneys' fees owed by the Defendant under 31 U.S.C. § 3730(d)(2). This statute mandates the award of attorney fees as part of a fee-shifting policy. See United States ex rel. Taxpayers Against Fraud v. Gen. Elec. Co., 41 F.3d 1032, 1035 (6th Cir.1994) ("The FCA qui tam statutes  contain a fee-shifting provision that aims at inducing `whistleblowers' to step forward and attorneys to pursue such actions."); United States ex rel. Bahrani v. Conagra, Inc., No. OO-cv-1077, 2009 WL 2766805, at *3 (D.Colo. Aug. 28, 2009), vacated in part on other grounds, 624 F.3d 1275 (10th Cir.2010) ("In crafting the fee shifting provisions of the FCA, Congress used the term `shall' to mandate an award of reasonable expenses, attorneys' fees and costs to a person who settles a claim or recovers a civil penalty and damages on behalf of the government."). By its nature, fee-shifting is designed to shift all of the costs (including attorney fees) to the loser in an action. The fact that the winner's attorneys receive compensation from another source is irrelevant to the fee award.
The Supreme Court recognized this feature when addressing another fee-shifting statute, 42 U.S.C. § 1988, in Venegas v. Mitchell, 495 U.S. 82, 90, 110 S.Ct. 1679,
See also Quesada v. Thomason, 850 F.2d 537, 543 (9th Cir.1988) (stating that a defendant obligated to pay fees under 42 U.S.C. § 1988 "should not benefit from the private [contingency fee] agreement by being permitted to pay anything less than. . . an otherwise reasonable lodestar fee"); Certain v. Potter, 330 F.Supp.2d 576, 589 (M.D.N.C.2004) ("Defendant's argument that [Plaintiff's attorney] might ultimately receive both the fee award and a contingency fee is not relevant to the question before this Court, that is, the determination of the reasonable fee award that Defendant must pay to Plaintiff. . . .") (emphasis in original).
The contingent fee agreement between Maxwell and his attorneys specifically envisions that the attorneys may choose to reduce the contingent fee if a statutory fee is awarded. (See
The Defendant's second argument is that Maxwell's degree of success in this action should result in a reduction of the award of attorneys' fee award. This argument is also unpersuasive.
There is no doubt that in cases where a plaintiff prevails on only some of its claims, that an attorney fee award should correspond to the successful result. Again, applying an analogous statute, in Hensley v. Eckerhart, 461 U.S. 424, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983), the Supreme Court held that
Id. at 440, 103 S.Ct. 1933. In Hensley, the plaintiff prevailed on certain claims and lost on others, but the district court awarded attorney fees without taking into amount fees incurred on the unsuccessful claims. See id. at 428-29, 438-39, 103 S.Ct. 1933. This was error; the Supreme Court vacated and remanded for consideration of the relationship between the extent of success and the amount of the fee award. See id. at 438-39, 103 S.Ct. 1933.
Here, there was one claim for relief. On that claim, the jury awarded some but not all of the damages requested. It awarded $7.56 million in damages, which was statutorily trebled to $22.67 million, then added to statutory penalties of
The requested $2,178,632.25 in attorneys' fees is approximately 28.8 percent of the damages awarded by the jury and 9.5 percent of the total award. This fact distinguishes this case from the cases cited by the Defendant, in which courts reduced the attorneys' fees award because actual damages were nominal or at least much smaller than the amount of attorneys' fees sought. See United States ex rel. Bahrani, No. OO-cv-1077, 2009 WL 2766805, at *2, *7 (D.Colo. Aug. 28, 2009), vacated in part on other grounds, 624 F.3d 1275 (10th Cir.2010) (where total damage award was $27,822 but the plaintiff's attorneys sought $3.45 million in attorneys' fees, court awarded fees in the amount of one-third of total damage award); Caputo v. Prof'I Recovery Servs., Inc., No. OO-4208, 2004 WL 1503953, at *1, *10 (D.Kan. June 9, 2004) (where final settlement was $15,000 but the plaintiff's attorneys sought $99,352 in attorneys' fees, court reduced fee award by 20 percent to $79,481).
For these reasons, the Court awards Maxwell the requested amount of $2,178,632.25.
III. Enhancement of Attorneys' Fee Award
Maxwell's application also seeks an enhancement of one-third of the lodestar amount "to account for the risk of non-payment given his attorneys' contingent fee." (
In City of Burlington v. Dague, 505 U.S. 557, 112 S.Ct. 2638, 120 L.Ed.2d 449 (1992), the Supreme Court held that an enhancement of the lodestar figure to account for the contingent nature of the representation is impermissible under environmental fee-shifting statutes. United States Circuit Courts have read Dague broadly as being applicable to other fee-shifting statutes. See, e.g., 19 Solid Waste Dep't Mechs. v. City of Albuquerque, No. 99-2172, 2000 WL 1133131, at *2 (10th Cir. Aug. 10, 2000) (in 42 U.S.C. § 1983 action, Court applied Dague and stated, "[e]nhancements for contingency are not permitted"); Shipes v. Trinity Industries, 987 F.2d 311, 323 (5th Cir.1993) (in Title VII action, court applied Dague and stated, "we now hold that the contingent nature of the case cannot serve as a basis for enhancement of attorneys' fees awarded to prevailing plaintiffs under traditional fee-shifting provisions").
Although this line of reasoning suggests that the contingent nature of the case might not be a relevant factor in making an attorney fee award in this case, this Court need not reach that question. Because the contingency fee agreement allows Maxwell's attorneys to recover both a 55 percent contingent fee and a statutory attorney fee award under 31 U.S.C. § 3730(d)(2), there is no need to compensate Maxwell's counsel for risk associated with undertaking representation in this matter—Maxwell and his attorneys have already done so.
IV. Litigation Expenses
Maxwell also seeks recovery of (1) his attorneys' expenses in prosecuting this action, which includes payments to one of his expert witnesses, Peter Ashton; and (2) Maxwell's own fees and expenses in serving as an expert witness in this action. 31 U.S.C. § 3730(d)(2) provides that a prevailing relator may recover "an amount of reasonable expenses which the court finds to have been necessarily incurred. . . . All such expenses . . . shall be awarded against the defendant." See also Shaw v. AAA Eng'g & Drafting, Inc., 213 F.3d 538, 541 (10th Cir.2000) (stating that a relator who successfully brings an FCA action is entitled to reasonable expenses).
A. Non-Expert Expenses
First, the Court notes that a portion of the expenses sought to be recovered by Maxwell appear to be unrelated to expert witness fees. Specifically, $13,264.51 of the expenses of The Law Firm of Michael Porter, $10,332.62 of the expenses of Richard C. LaFond P.C., and all the expenses of Reilly Pozner LLP—$7,215.94. (
B. Expenses Attributable to Peter Ashton
Expenses of $78,528.72 paid by the Law Firm of Michael Porter and Richard C. LaFond P.C. are attributable to the "expert services of Peter Ashton." (
The Defendant relies on West Virginia University Hospitals, Inc. v. Casey, 499 U.S. 83, 111 S.Ct. 1138, 113 L.Ed.2d 68 (1991). In Casey, the Supreme Court held that expert witness fees were not recoverable as a part of "a reasonable attorney's fee" under (what is now a former version of) 42 U.S.C. § 1988. See id. However, unlike the version of 42 U.S.C. § 1988 considered in Casey, 31 U.S.C. § 3730(d)(2) expressly lists "reasonable expenses" as a recoverable item distinct and separate from "reasonable attorneys' fees and costs." 31 U.S.C. § 3730(d)(2) (a prevailing relator "shall also receive an amount for reasonable expenses which the court finds to have been necessarily incurred, plus reasonable attorneys' fees and costs"). Casey is inapplicable to a statute which expressly lists "expenses" as separately recoverable from "attorneys' fees." See United States ex rel. Garibaldi v. Orleans Parish Sch. Bd., 46 F.Supp.2d 546, 567 (E.D.La.1999), vacated on other grounds, 244 F.3d 486 (5th Cir.2001) (stating that "reasonable expenses" under the FCA includes expert fees). Since Casey was decided, courts have awarded expert witness fees under the FCA. United States ex rel. Miller v. Bill Harbert Int'l Constr., Inc., 601 F.Supp.2d 45, 59-60 (D.D.C. 2009), vacated in part on other grounds, 786 F.Supp.2d 110, 2011 WL 1833243 (D.C.Cir. May 12, 2011); United States ex rel. Abbott-Burdick v. University Medical Associates, No. 2:96-1676-12, 2002 WL 34236885, at *23-*24 (D.S.C. May 23, 2002). The Court therefore awards Maxwell
C. Relator Maxwell's Expert Fees and Expenses
Maxwell himself also served as an expert witness in this action, and seeks to recover the expert fees and expenses attributable to his own work. The Court declines to award Maxwell his expert fees and expenses because he was prosecuting this action and there is no showing that he reasonably anticipated being compensated as an expert witness. See Barber v. Ruth, 7 F.3d 636, 646 (7th Cir.1993), superceded on other grounds by rule, Fed.R.Civ.P. 30(b) ("As a general rule, parties may not normally collect witness fees."); Bowling v. Hasbro, Inc., 582 F.Supp.2d 192, 209 (D.R.I.2008) ("Parties are generally not awarded witness fees."); Earth Island Inst. v. Christopher, 942 F.Supp. 597, 608 (Ct. Int'l Trade 1996), vacated on other grounds, Earth Island Institute v. Albright, 147 F.3d 1352 (Fed.Cir.1998) ("[T]here is also no showing that, if Earth Island Institute and Todd Steiner were in fact in expert support of their counsel, as opposed to merely intentionally-conspicuous parties to this litigation, they either expected to be (or have been) paid for that expertise by counsel. In the absence of that kind of actual attorneys' expense, there can be no court-ordered reimbursement.").
For the foregoing reasons, the Relator's Application for Award of Attorneys' Fees and Expenses and Costs (