United States District Court, D. Idaho
UNITED STATES OF AMERICA ex rel. DR. JEFFREY JACOBS, Plaintiff,
CDS, P.A. d/b/a POCATELLO WOMEN'S HEALTH CLINIC; POCATELLO HOSPITAL, LLC, d/b/a PORTNEUF MEDICAL CENTER, LLC, a Delaware limited liability company; LHP POCATELLO, LLC, a Delaware limited liability company, Defendants.
MEMORANDUM DECISION & ORDER
LYNN WINMILL JUDGE
the Court is Plaintiff-Relator Dr. Jeffrey Jacobs'
Renewed Motion for Reasonable Attorneys' Fees and Costs
(Dkt. 71). Plaintiff seeks $106, 532 in attorneys' fees
and $1, 130.57 in costs. For the reasons explained below, the
Court will award the full amount of costs but will reduce the
attorneys' fees to $79, 904.
2014, Dr. Jeffrey Jacobs filed this action on behalf of the
United States pursuant to the qui tam provisions of the False
Claims Act, 31 U.S.C. § 3724 et. seq. Jacobs alleged
that the Pocatello Women's Health Clinic and the Portneuf
Medical Center submitted patient claims to the Medicare and
Medicaid programs, falsely certifying that such claims were
in compliance with the Stark Act, 42 U.S.C. § 1395nn and
the Anti-Kickback Act, 42 U.S.C. § 1320a-7b. According
to Dr. Jacobs, the medical center and the women's health
clinic engaged in a scheme to illegally shift the
clinic's overhead costs to the medical center as a reward
to the clinic for its referrals to the medical center.
January 2017, Dr. Jacobs filed a Chapter 7 bankruptcy
petition, and shortly after that the United States decided
not to intervene in this action. See In re Jacobs,
No. 17-00018-TLM (Bankr. D. Idaho); Notice of Election to
Decline Intervention, Dkt. 53. The bankruptcy trustee did not
intend to litigate this action on behalf of the bankruptcy
estate; he was prepared to abandon the estate's interest
in this action, which would have allowed Dr. Jacobs to pursue
it on his own.
defendants learned of a potential abandonment, they indicated
a willingness to settle. See Ex. B to Casperson Dec.,
Motion to Approve Compromise, Dkt. 65-4, at 6. In late
2017, defense counsel and the bankruptcy trustee reached an
agreement. See Settlement Agreement, In re Jacobs,
No. 17-00018-TLM, Dkt. 41-1 (Bankr. D. Idaho).
Defendants agreed to pay $69, 087 to the United States. See
Id. ¶ 1. Of this amount, the United States
would keep $51, 816 and the remaining $17, 271 would be paid
to Dr. Jacobs' bankruptcy estate. The settlement
agreement did not obligate defendants to pay attorneys'
fees incurred in this action, but Dr. Jacobs did not release
that claim either. Id. ¶ 2. Instead, the
settlement agreement provided that this Court would retain
jurisdiction to enforce the terms of the settlement
agreement, “including but not limited to any claim by
Relator for attorneys' fees. See Id. ¶ 13;
see also Joint Stipulation of Dismissal, Dkt. 63, ¶ 5
(“The Court will retain jurisdiction over the Parties
to the extent necessary to enforce the terms and conditions
of the Settlement Agreement, including but not limited to any
claim by Relator for attorney's fees.”).
after the settlement agreement was finalized, Dr. Jacobs
asked the Court to award attorneys' fees and costs. See
Dkt. 65. The Court denied the motion, without prejudice,
because the bankruptcy trustee had not yet abandoned any
claim to attorneys' fees. See June 7, 2018 Order, Dkt.
69, at 4-5. Jacobs reports that the trustee has now abandoned
any claim to attorneys' fees. See Dkt. 71-1, at 1.
Accordingly, he renews his motion for attorneys' fees. He
asks the Court to award $106, 532 in attorneys' fees and
$1, 130.57 in costs.
Plaintiff's Entitlement to Attorneys' Fees
undisputed that the prevailing plaintiff in a declined qui
tam action is entitled to receive “an amount for
reasonable expenses which the court finds to have been
necessarily incurred, plus reasonable attorneys' fees and
costs.” 31 U.S.C. § 3730(d)(2). Here, Dr. Jacobs
settled the claim with defendants, so there is no question
that his attorneys are entitled to a fee award.
calculation of a reasonable fee award involves a two-step
process. Fischer v. SJB-P.D. Inc., 214 F.3d 1115,
1119 (9th Cir. 2000). First, the court calculates the
presumptive fee award, also known as the “lodestar
figure, ” by taking the No. of hours reasonably
expended on the litigation and multiplying it by a reasonable
hourly rate. Id. (citing Hensley v.
Eckerhart, 461 U.S. 424, 433 (1983)). Second, in
“appropriate cases” the court may enhance or
reduce the lodestar figure based on an evaluation of the
factors set forth in Kerr v. Screen Extras Guild,
Inc., 526 F.2d 67, 69-70 (9th Cir.1975), that were not
taken into account in the initial lodestar calculation.
Intel Corp. v. Terabyte Intern., Inc., 6 F.3d 614,
622 (9th Cir.1993) (citation omitted). The Ninth Circuit
has cautioned that there is a “strong
presumption” that the lodestar figure represents a
reasonable fee and that adjustment upward or downward is
“the exception rather than the rule.”
D'Emanuele v. Montgomery Ward & Co., 904
F.2d 1379, 1384 (9th Cir. 1990).