Julia Rice v. Ryders Health Management, Inc. (2016)

decision maker.  See, Label Systems Corp. v. Aghamohammadi, 270 Conn. 291, 335, 852 A.2d 703 (2004);  Waterbury Petroleum Products, Inc. v. Canaan Oil and Fuel Co., Inc., 193 Conn. 208, 236, 477 A.2d 988 (1984).

RULING RE PLAINTIFF'S MOTIONS FOR DETERMINATION OF FEES AND COSTS

In these consolidated employment litigation cases, a jury rendered a verdict for the plaintiff, Julia Rice, and against the defendants, Ryders Health Management, Inc. (“Ryders”) and Mystic Manor Nursing & Rehabilitation Center, LLC (“Mystic Manor”) on November 6, 2015.  The parties agreed that if the jury voted to award punitive damages, the court would calculate and assess the amount of any such punitive damages awarded in a separate proceeding after the verdict, and the jury was so instructed.  The jury verdict did so award the plaintiff punitive damages on Counts Four and Nine of her complaint against Ryders for breach of implied covenant of good faith and fair dealings and for wrongful termination.  It also awarded punitive damages for the plaintiff on Counts Four and Eight of her complaint against Mystic Manor, also for breach of implied covenant of good faith and fair dealings and for wrongful termination.  The plaintiff timely filed a motion for determination of fees and costs, consistent with the agreed upon procedure, on November 25, 2015.  See Doc. No. 160.00 in the Mystic Manor case file;  see also Doc. No. 174.00 in the Mystic Manor case file and Doc. No. 222.00 in the Ryders case file.  The court conducted a hearing on the motions for determination of fees and costs on June 6, 2016.  For the following reasons, the court awards punitive damages and costs in this case as follows:  As to Ryders, punitive damages are $45,809.66.  As to Mystic Manor, punitive damages are $8,425.00.  As to both Ryders and Mystic Manor, jointly and severally, punitive damages are an additional $51,725.00.  Judgment for punitive damages shall enter in favor of the plaintiff, Julia Rice and against the defendants, Ryders Health Management, Inc. and Mystic Manor Nursing & Rehabilitation Center, LLC, accordingly.  Costs shall be taxed against Ryders in the amount of $1,412.95.  Costs shall be taxed against Mystic Manor in the amount of $680.00

I

Punitive damages are limited to the costs of litigation, including attorneys fees, less taxable costs;  but, within that limitation, the extent to which they are awarded is in the sole discretion of the

II

Notwithstanding the jury verdict, defendants argue that no punitive damages should be awarded, or that they should be limited, for a variety of reasons.  The issues are discussed, seriatim:

A

First, defendants argue that the court should not rule on the plaintiff's motions because the defendants have filed an appeal of this court's decision on their motion to set aside verdict, motion notwithstanding the verdict and motion for remittitur.  It is correct that the court denied defendants' motions and entered judgment on April 7, 2016;  and, after receiving an extension of time, defendants appealed on May 16, 2016.  However, defendants cite no authority for their request that the court abstain from calculating the amount of punitive damages pending appeal, and the court is not aware of any such authority.  The judgment allowing punitive damages remains effective pending appeal.  An appeal does not vacate a judgment.  It serves only to stay enforcement of the rights acquired by the successful litigant.  Practice Book § 61–11;  Saunders v. Saunders, 140 Conn. 140, 146, 98 A.2d 815 (1953).  Thus, calculations of punitive damages may be made after judgment, and after the filing of an appeal from that judgment.  See, e.g., Hylton v. Gunter, 313 Conn. 472, 475, 97 A.3d 970 (2014).

B

In support of her motions for a determination of fees and costs, plaintiff's counsel originally filed affidavits of fees and costs in both case files with contemporary time records detailing services performed, and time expended for each service, multiplied by an hourly rate of $250.00 per hour.  Plaintiff also described a variety of costs.  Defendants objected to the punitive damages requests because the fees and costs listed by the plaintiff contained many double charges, incorrect charges and/or miscalculations, lacked documentation proving costs incurred, and because the plaintiff failed to subtract taxable costs from the total as required.  Plaintiff next provided some documentation of costs incurred.  The parties then conferred and came to an agreement and stipulated that the following costs and fees were correctly calculated:

Taxable costs against Mystic:  $680.60;

Taxable costs against Ryders:  $1,412.95;

Attorneys Fees exclusively in Mystic case:  $8,425.00

Attorneys Fees exclusively in Ryders case:  $42,470.00 in fees and $3,339.66 in non-taxable costs for a total:  $45,809.66

Attorneys Fees requested as joint and several obligation of Ryders and Mystic Manor:  $51,725.00.

Stipulation, June 8, 2016.

The defendants reserved their right to continue with all of their objections.

The court accepts the stipulation as plaintiff's correctly calculated attorneys fees, non-taxable costs and taxable costs incurred in this case which form the basis for her request for an assessment of punitive damages.

C

Next, the defendants argue that punitive damages should not be assessed on the basis of attorneys fees billed at an hourly rate because the plaintiff's counsel took the case on a contingency fee basis.  “It is well established that a trial court calculating a reasonable attorneys fee makes its determination while considering the factors set forth under rule 1.5(a) of the Rules of Professional Conduct ․ [including] whether the fee is fixed or contingent.”  (Citations omitted.)  Schoonmaker v. Lawrence Brunoli, Inc., 265 Conn. 210, 259, 828 A.2d 64 (2003).  The fee agreement involved in the instant case was attached to the plaintiff's motion, and it provided, in pertinent part, as follows:

RETAINER

Four Thousand Dollars ($4,000.00) To Research and Draft Complaint/Negotiate with Ryders Health Management before suit.

FURTHER FEE:

B. FLAT FEE:

C. Contingent Fee:

One third of any sums recovered through settlement less $4,000 retainer;  (E.G. If settlement = $12,000 there is no additional fee.)  If case put in suit and tried:

Contingent fee of sums awarded and collected in judgment against defendant as punitive damages/attorneys fees in excess of $4,000;  submitted at hourly rate of $250 (Two Hundred and Fifty Dollars).

Legal Representation Agreement (emphasis added).

Defendants argue that this agreement shows that plaintiff's counsel took the case on a contingency fees basis of one-third after the first $4,000.00.  Since plaintiff only won $15,000.00 in damages,¹ her attorneys fees would be $4,000.00 plus a $5,000.00 share of the damages for a total of $9,000.00.  Therefore, they argue, “the total attorneys fees awarded may not exceed $9,000.00 for the consolidated cases.”  Defendants' Brief, p. 3.

The plaintiff argues that the defendants misread the legal representation agreement.  She argues that the agreement provided that attorneys fees would be calculated on an hourly rate basis if she became eligible for punitive damages or attorneys fees.  The court agrees with the plaintiff.  “The basic purpose of [contract] construction is to ascertain and give effect to the intention of the parties ․ Where the language of the contract is clear and unambiguous, the contract is to be given effect according to its terms.  A court will not torture words to import ambiguity where the ordinary meaning leaves no room for ambiguity ․ Although ordinarily the question of contract interpretation, being a question of the parties intent, is a question of fact ․ [w]here there is definitive contract language, the determination of what the parties intended by their contractual commitments is a question of law.”  (Citations omitted;  internal quotation marks omitted.)  Reizfeld v. Reizfeld, 125 Conn.App. 782, 789, 40 A.3d 320, cert. denied, 300 Conn. 915, 13 A.3d 1103 (2011).  While it is not a model of clarity, the agreement, in abbreviated language, expresses that if the case settled prior to commencement of suit, attorneys fees would be based on a one-third contingency fee formula, with adjustments.  If suit was brought and tried, and if the plaintiff became eligible for punitive damages, the emphasized portion above indicates that attorneys fees would be billed by the hour at the rate of $250.00 per hour, with adjustments.  Accordingly, the court finds that the plaintiff is not limited to requesting no more than $9,000.00 for attorneys fees based on the legal representation agreement.

“A trial court should not depart from a reasonable fee agreement in the absence of a persuasive demonstration that enforcing the agreement would result in substantial unfairness to the defendant.”  Sorrentino v. All Seasons Services, Inc., 245 Conn. 756, 776, 717 A.2d 150 (1998).  The court finds that the hourly rate fee agreement is reasonable under the applicable tests.  While the employment of an hourly rate formula, under the circumstances of the instant case, results in a substantially higher punitive damages award as opposed to the contingency fee formula, there is no demonstration of why it would be substantially unfair to the defendants.  Accordingly, this court finds that the plaintiff is entitled to punitive damages utilizing the stipulated, correctly calculated attorneys fees, which are based on a reasonable hourly rate times reasonable hours expended.

D

Next, the defendants argue that the plaintiffs request for attorneys fees is excessive and should be significantly reduced.  The court does not agree.

As indicated above, the award of punitive damages is limited to attorneys fees plus costs minus taxable costs.  “[T]he initial estimate of a reasonable attorneys fee is properly calculated by multiplying the number of hours reasonably expended on the litigation times a reasonable hourly rate ․ The courts may then adjust this lodestar calculation by other factors ․ For guidance in adjusting attorneys fees, Connecticut courts have adopted the twelve factors set forth in Johnson v. Georgia Highway Express, Inc., [488 F.2d 714, 717–19 (5th Cir.1974).  The Johnson factors are (1) the time and labor required;  (2) the novelty and difficulty of the questions;  (3) the skill requisite to perform the legal service properly;  (4) the preclusion of other employment by the attorney due to acceptance of the case;  (5) the customary fee for similar work in the community;  (6) whether the fee is fixed or contingent;  (7) time limitations imposed by the client or the circumstances;  (8) the amount involved and the results obtained;  (9) the experience, reputation and ability of the attorneys;  (10) the undesirability of the case;  (11) the nature and length of the professional relationship with the client;  and (12) awards in similar cases.”  (Citation omitted;  internal quotation marks omitted.)  Perez v. D and L Tractor Trailer School, 117 Conn.App. 680, 705, 981 A.2d 497 (2009), cert. denied, 294 Conn. 923, 985 A.2d 1062 (2010);  see also, Whitney v. J.M. Scott Associates, Inc., 164 Conn.App. 420, 435 (2016).

Under the parties' stipulation, plaintiff claims a lodestar of $42,470.00 attributed solely to the Ryders case;  $8,425.00 attributable solely to the Mystic Manor case, and $51,725.00 attributed to both.  Two cases were filed because, after the Ryders case was filed, the defendant claimed that the plaintiff was not hired by Ryders;  rather, she was hired by Mystic Manor.  That made a suit against Mystic Manor necessary.  Suit was filed against Mystic Manor, the cases were consolidated, and the litigation proceeded against both entities.  Both entitles were found liable.

Defendants do not contest the reasonableness of the rate of $250.00 per hour, nor do they contest the costs and non-taxable costs claimed in the stipulation.  They do not dispute that plaintiff's counsel actually expended the amount of time claimed on these cases, and they do not contend that the time spent was unreasonable.  The court finds that the stipulated correct calculation of attorneys fees reflects reasonable rates and reasonable time expended.  Defendants argue, however, that the total fee is excessive and should be reduced significantly because of the limited success achieved, citing Hensley v. Eckerhart, 461 U.S. 424, 435, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983).  They argue that the jury rendered a verdict for the plaintiff on only seven of the twenty-two counts tried in the consolidated trial, so, plaintiff should be awarded only 32 percent of her attorneys fees.

“A key consideration in evaluating [a claim for litigation expenses] is the overall extent of the success achieved.  Where a party succeeds on [one] claim, but fails on other claims brought in the same suit, the size of his [attorneys fee] award should reflect his success, as determined by the trial court in securing redress for the injuries that prompted his [successful] claim and reasonable legal cost incurred in pursuing this success.  Consequently, even when the plaintiff's claims are interrelated, the lodestar amount may be excessive when the plaintiff has achieved only partial or limited success ․ Again, the most critical factor is the degree of success obtained.”  (Citations omitted.)  Metcoff v. NCT Group, Inc., 52 Conn.Sup. 363, 376, 50 A.2d 1004 (2011), aff'd, 137 Conn.App. 578, 49 A.3d 282, cert. denied, 307 Conn. 924, 55 A.3d 566 (2012) (allowing only 40 percent of attorneys fees based, in part, on plaintiff's failure to prevail on numerous counts).

It is true that the jury rendered a verdict for the plaintiff in the instant case only on seven counts, and it is true that, prior to trial, the operative complaints contained a total of twenty-two counts.  But it is not true that the jury rendered verdict for the defendants on the other fifteen.  The plaintiff withdrew eleven counts during trial.  Those eleven counts were mostly duplicative or overlapping of the other counts.  They involved only different legal theories of recovery concerning the same defendants and the same essential facts as those involved in the remaining counts.  The removal of those counts helped simplify the case.  Thus, the jury only rendered verdict for the defendants on four counts.

In the Hensley v. Eckerhart case, the U.S. Supreme Court determined that, when calculating attorneys fees pursuant to the lodestar method, a trial court does not abuse its discretion in refusing to apportion an award if attorneys fees based on the success or failure of the plaintiff on particular issues where the facts and legal issues are interrelated.  Tomick v. United Parcel Service, Inc., 135 Conn.App. 589, 624, 43 A.3d 722, cert. denied, 305 Conn. 920, 47 A.3d 389 (2012).  In the instant case the plaintiff was successful on the breach of implied in fact contract, breach of implied covenant of good faith and fair dealing, and wrongful discharge claims against Ryders and Mystic Manor, and on the negligent infliction of emotional distress claims against Ryders.  The plaintiff failed on all four of her fraudulent misrepresentation claims against all four defendants:  Ryders, Mystic Manor, Martin Sbriglio and Kenneth Kopchik.  However, there is no practical way to identify and segregate the work between counts or claims without being arbitrary.  The claims on which plaintiff was successful encompassed all of the other claims in the case.  All of the factual development and all of the legal work on all of the claims were related or came from a common nucleus, were worked on concurrently, and all of the effort contributed to the success of the claims on which the plaintiff prevailed.  In such a circumstance, an apportionment of attorneys fees is neither practicable nor necessary.  See Total Recycling Services of Connecticut, Inc. v. Connecticut Oil Recycling Services, LLC, 308 Conn. 312, 325–33, 63 A.3d 896 (2013);  Russell v. Dean Witter Reynolds, Inc., 200 Conn. 172, 195, 510 A.2d 972 (1986);  Noyes v. Antiques at Pompey Hollow, LLC, 144 Conn.App. 582, 597, 73 A.3d 794 (2013).

Nor can the court characterize the success achieved as minimal compared to the scope of the litigation.  It is true that the litigation was long-running, and the trial took 12 days.  The effort expended was large.  The plaintiff documented an extensive amount of legal work performed over a 5 year period.  In comparison, the plaintiff had been terminated from her employment for billing for services not performed.  She won a total of $115,000.00 and effectively cleared her name.  See Ruling on Defendants' Motions to Set Aside Verdict;  Motions for Judgment Notwithstanding the Verdict and Motions for Remittitur (Doc. No. 220.50).  That was not a minor success compared to the effort expended.

Finally, considering the Johnson factors, the court finds that no adjustment in the lodestar would be in order.  The court's findings are as follows:  With respect to time and labor required, the court finds that plaintiff's counsel was a solo practitioner and he billed for all of the legal work, but the time expended was proportionate to the tasks necessary.  As to the novelty and difficulty of the questions, the court finds that the issues were not overly complex, but were made complicated and time consuming by their volume.  As to the skill requisite to perform the service properly, the court finds that no extraordinary skill was required.  As for preclusion of other employment, the court finds no evidence of such sacrifice in this case.  As for customary fee, the court finds that the rate of $250.00 per hour was reasonable.  As for fee arrangement, the court finds that the plaintiff's contract called for an hourly rate if she became eligible for punitive damages.  As for time limitations, the court finds that this case commanded no extraordinary priority.  As to the amount involved and results obtained, for the reasons explained above, the court finds that plaintiff's success was not minor compared to the effort expended.  As to the experience, reputation and ability of the attorneys, the court finds that expertise or special study in the field of employment law was necessary for proper litigation of this case;  but it, nevertheless, finds no reason to depart from the lodestar.  As to the undesirability of the case, the court finds that this case was not unpopular, and pursuit of this case required no special courage.  As for the nature and length of the professional relationship with the client, the court finds no evidence of a longstanding professional relationship in this case.  As for awards in similar cases, the court observes that a comparison of awards is not of much value as each case takes a different amount of time and involves different issues.  However, this court observes that the attorneys fees and costs requested in the instant case were not out of line with what this court has observed in cases involving a similar number of factual and legal issues, need for trial preparation and actual number of days of trial proceedings.  Accordingly, no lodestar adjustment will be made, and the court finds no justification to award less than the full amount of attorneys fees requested.

Accordingly, the court will award punitive damages in this case as follows:  As to Ryders, punitive damages are found to be $42,470.00 for attorneys fees plus non-taxable costs of $3,339.66, plus taxable costs of $1,412.95, minus taxable costs of $1,412.95 for a total award of $45,809.66.  As to Mystic Manor, punitive damages are found to be $8,425.00 for attorneys fees, plus taxable costs of $680.00 minus taxable costs of $680.60 for a total award of punitive damages of $8,425.00.  As to both Mystic Manor and Ryders, jointly and severally, punitive damages are found to be $51,725.00 for attorneys fees for an additional award of $51,725.00.

III

For all of the foregoing reasons, the court awards punitive damages and costs in this case as follows:  As to Ryders, punitive damages are $45,809.66.  As to Mystic Manor, punitive damages are $8,425.00.  As to both Ryders and Mystic Manor, jointly and severally, punitive damages are an additional $51,725.00.  Judgment for punitive damages shall enter in favor of the plaintiff, Julia Rice and against the defendants, Ryders Health Management, Inc. and Mystic Manor Nursing & Rehabilitation Center, LLC, accordingly.  Costs shall be taxed against Ryders in the amount of $1,412.95.  Costs shall be taxed against Mystic Manor in the amount of $680.00.

Robert F. Vacchelli

Judge, Superior Court

FOOTNOTES

FN1. The trial proceeded on eleven counts against four defendants.  The jury awarded the plaintiff $15,000.00 in damages against Ryders and Mystic Manor on her breach of implied in fact contract, breach of implied covenant of good faith and fair dealing and wrongful discharge counts.  They also awarded her $100,000.00 in damages against Ryders on her negligent infliction of emotional distress count against Ryders.  Defendants argue that the $100,000.00 awarded on the negligent infliction of emotional distress count should not be included in calculating the contingency fee earned for purposes of assessing punitive damages because punitive damages are not available and were not requested on that count..  FN1. The trial proceeded on eleven counts against four defendants.  The jury awarded the plaintiff $15,000.00 in damages against Ryders and Mystic Manor on her breach of implied in fact contract, breach of implied covenant of good faith and fair dealing and wrongful discharge counts.  They also awarded her $100,000.00 in damages against Ryders on her negligent infliction of emotional distress count against Ryders.  Defendants argue that the $100,000.00 awarded on the negligent infliction of emotional distress count should not be included in calculating the contingency fee earned for purposes of assessing punitive damages because punitive damages are not available and were not requested on that count.

Vacchelli, Robert F., J.