Attorneys' Fees Archives - Employing Alabama

FLSA: Litigating On Principle Costs $210K in Attorneys’ Fees

December 18, 2017Robert C. Lockwood

FLSA attorneys' fees principle Alabama Employment Law — In FLSA claims, employers which litigate “as a matter of principle” may wind up paying big money in attorneys’ fees if they lose.

Last week, Judge David Proctor issued a decision in a Fair Labor Standards Act (“FLSA”) case, which provides a warning to employers who want to litigate claims “as a matter of principle.” See Lopez-Easterling v. Charter Communications, Inc., No. 2:14-cv-01493-RDP, 2017 WL 6406520 (N.D. Ala. Dec. 15, 2017). Karen Lopez-Easterling sued her employer, Charter Communications, for overtime violations. On May 18, 2017, a jury awarded her $5,355.72 as payment for those violations.

The FLSA permits a “prevailing party” to recover their attorneys’ fees. Ms. Lopez-Easterling’s three attorneys spent 507.8 hours working on the case at rates between $325.00 and $450.00 per hour. Thus, they asked Judge Proctor to award them $215,685.00 in attorneys’ fees.

Judge Proctor’s opinion largely granted the request for fees. After some additions and a few reductions, Judge Proctor awarded $211,710.00 in fees. The opinion strongly suggests that Charter Communications’ attitude towards the litigation influenced the fee award. Judge Proctor discussed the fact that Charter “made crystal clear that it had no interest in resolving the case and exercised its right to ignore all of Plaintiff’s proposals.” He also noted that Charter brought a “contest everything” approach to the litigation. Finally, Charter’s own communications with the Judge during pre-trial conference may have been the deciding factor:

[Charter] had multiple opportunities to resolve this case prior to trial and chose not to do so. [Charter] stated that it was not interested in settlement and was trying the case on principle. In light of that position, the court gave [Charter] a warning that went something like this: “you have the absolute right to take that position, but if you lose at trial — in for a dime, in for a dollar.”

Clients frequently want to go to court “as a matter of principle.” But, principles can frequently be costly. In this case, Charter could have settled for a relatively small payment early in the litigation, and avoided the substantial fee that Judge Proctor required after trial. Instead, Charter will face a triple-threat of losses: (1) $5,355.72 in overtime payments; (2) $211,710.00 in payments to the employee’s attorneys; and, (3) payments to their own attorneys of at least that amount.

Employee Ordered to Pay Employer’s $235,000 Legal Bill

June 26, 2017Robert C. Lockwood

Fees frivolous employment discrimination claim — An employee was ordered to pay $235,249.80 in legal fees after filing a frivolous discrimination claim.

The Eleventh Circuit Court of Appeals just gave employees a reason to think twice before filing a frivolous law suit. The Court required an employee to pay his employer $235,249.80 for filing a frivolous employment discrimination claim. See Hamilton v. Sheridan Healthcorp, Inc., No. 16-10667, 2017 WL 2665040 (11th Cir. Jun. 21, 2017)(“Hamilton II“). This was the second time that Dr. Dwain Hamilton filed an appeal with the Eleventh Circuit.

In 2015, the Court affirmed dismissal of Dr. Hamilton’s discrimination claims against his employer, Sheridan Healthcorp. See Hamilton v. Sheridan Healthcorp, Inc., 602 Fed. App’x 485 (11th Cir. 2015)(“Hamilton I“). In Hamilton I, Dr. Hamilton claimed that he was transferred from a night shift position to day shift, and later terminated, because of his race. But, the trial court and the Eleventh Circuit both found that he was unable to establish a basic, prima facie, case of discrimination. Dr. Hamilton also attempted to claim that he was terminated in retaliation for complaining about discrimination. Yet, the Eleventh Circuit found that he offered no evidence to support that claim, and actually changed his testimony in an after-the-fact attempt to create a claim.

After prevailing, Sheridan Healthcorp asked the trial court to award it $235,249.80 in attorneys’ fees spent defending Hamilton I. Employers rarely win such requests, because fees can only be awarded if an employee’s claim is “frivolous, unreasonable, or groundless.” Christianburg Garment Co. v. EEOC, 434 U.S. 412, 422 (1978). Courts are usually reluctant to call any claim “frivolous,” but that’s exactly what the trial court did in Hamilton II. The Eleventh Circuit reviewed the trial court’s decision and affirmed in Hamilton II.

Hamilton II provides a warning to employees: Think carefully before filing that employment discrimination claim. If a court finds that claims are frivolous, then the employee is potentially on the hook for the employer’s legal fees.

“Throwed Rolls” and Attorneys’ Fees: The High Costs of FLSA Violations

February 22, 2016Robert C. Lockwood

On January 22, 2015, Ramona Brown sued Lambert’s Café, III, Inc. in Foley, Alabama for alleged violations of the Fair Labor Standards Act. You may know Lambert’s as “the only home of throwed rolls” — where servers actually throw dinner rolls to customers. Ms. Brown claimed that she and other servers at the restaurant were not properly paid for time they were required to work. A review of court records indicates that the parties entered into settlement negotiations relatively early in the process.

On September 24, 2015, the court approved a settlement under which Lambert’s paid $38,000.00, which was split among five employees. Because those employees were “prevailing parties,” their attorneys were entitled to payment of attorneys’ fees. But, the parties could not agree on the amount of a “reasonable” fee.

So, on January 27, 2016, Magistrate Judge William E. Cassady of the United States District Court for the Southern District of Alabama entered an order awarding the employees’ attorneys $41,943.15 in fees and costs. Notably, the employees’ attorneys submitted hours and billable rates to the Court which could have totaled more than $60,000.00 in fees. Thus, the Lambert’s case demonstrates that the costs of violating the FLSA can easily skyrocket — not only from damages to employees, but also to pay their attorneys.