[CITE: Hoosier Environmental Council v. DNR, 10 CADDNAR 324 (2006)]
[VOLUME 10, PAGE 324]
Cause #:97-065R
Caption: Hoosier Environmental Council v. Department
of Natural Resources
Administrative Law Judge: Jensen
Attorneys: Mullett; Boyko
Date: August 25, 2006
[NOTE 1: IN LATE 2006, BOTH PARTIES SEPARATELY TOOK JUDICIAL REVIEW IN THE MARION SUPERIOR COURT (CAUSE NUMBERS 49F12-0609-MI-39929 AND 49F12-0610-MI-40714). THIS FINAL ORDER RESULTED FROM COURT OF APPEALS DECISION, Department of Natural Resources v. Hoosier Environmental Council, 831
N.E.2D 804 (IND. APP. 2005), WHICH REVERSED AND REMANDED IN PART THE TRIAL
COURT'S ORDER ON JUDICIAL REVIEW OF Hoosier Environmental Council v. Foertsch Constr. Co. and DNR, 8 CADDNAR 178 (2003).]
[NOTE 2: ON JULY 6, 2007, THE MARION SUPERIOR COURT VACATED THE NRC'S AUGUST 30, 2006 FINAL ORDER AND REMANDED FOR FURTHER PROCEEDINGS. A LINK TO THE COURT'S ORDER FOLLOWS THE ADMINISTRATIVE FINDINGS OF FACT AND CONCLUSIONS OF LAW. ON AUGUST 8, 2007, THE DEPARTMENT TOOK APPEAL IN CAUSE NO. 49A05-0708-CV-00449, WHICH WAS ULTIMATELY DISMISSED. THE NRC ENTERED ITS FINAL ORDER ON REMAND ON MARCH 25, 2008. SEE HEC v. DNR, 11 CADDNAR 295 (2008).]
FINAL ORDER
The Department is ordered to
pay to HEC, the total sum of $90,107.39 in costs and expenses, including
reasonable attorney fees.
PROCEDURAL BACKGROUND
1.
This matter comes
before the Natural Resources Commission (Commission) on remand from judicial
review of the Commission’s previous determination that HEC was neither eligible
nor entitled to a fee award for their initiation of and participation in Hoosier Environmental Council v. DNR and
Foertsch Construction Company, Inc., 7 CADDNAR 162, February 1997 (“Foertsch Litigation”) and prosecution
of its petition for fees in this instant proceeding.
FOERTSCH LITIGATION
2.
The Foertsch
Litigation was initiated by HEC on June 9, 1995 with the filing of its petition
for administrative review following the Department of Natural Resources’ (Department) May 10, 1995 approval of
Foertsch’s application for amendment of its existing Indiana Surface Mining
Control and Reclamation Act (I-SMCRA) permit.
3.
Administrative
Law Judge Teeguarden, who was appointed by the Commission to preside over the
Foertsch Litigation, issued a non-final order (Teeguarden Non-Final Order) on October 10, 1996.
[VOLUME 10, PAGE 325]
4.
HEC, Foertsch and
the Department, each filed objections to the Teeguarden Non- Final Order and
the Commission issued its Final Order (Commission
Order) pursuant to IC 4-21.5-3-29 on February 19, 1997.
5.
On March 21, 1997
HEC and Foertsch sought judicial review of the Commission Order in the
6.
The Daviess
County Circuit Court issued an order affirming the Commission Order on
September 13, 1999.
7.
No further
judicial review was pursued by any party.
FEE PROCEEDING
8.
During the
pendency of judicial review on the Foertsch Litigation, HEC filed with the Commission
its Petition for Fees pursuant to IC 14-34-15-10 and 312 IAC 3-1-13[1].
9.
The Commission
initially appointed Administrative Law Judge Rider to preside over the Fee Proceeding. As a consequence of a change in ALJ Rider’s
employment it became necessary for him to withdraw as the presiding
administrative law judge and the Commission appointed Special Administrative
Law Judge Penrod.
10. SALJ Penrod issued his Findings of Fact, Conclusions
of Law and Non-Final Order (Penrod
Non-Final Order) on February 20, 2003 awarding to HEC a full award of all
sought fees relating to the Foertsch Litigation and the prosecution of its fee petition
for costs incurred through May 31, 2002.
11. The Department filed objections to the Penrod
Non-Final Order with the Commission, as the ultimate authority pursuant to IC
4-21.5-3-29, on March 7, 2003. The
Commission entered its Final Order (Commission
Fee Order) on July 22, 2003, vacating the Penrod Non-Final Order and
determining that HEC was not eligible for any award of fees and thus did not
reach the issue of HEC’s entitlement to a fee award.
12. HEC sought judicial review of the Commission Fee Order
in the Marion Superior Court, which entered its final order on May 24,
2004. The Marion Superior Court
determined that HEC was both eligible for an award of fees and further that HEC
was entitled to the full fee award as previously determined in the Penrod
Non-Final Order.
13. The Department initiated an appeal of the Marion
Superior Court Order and on July 26, 2005 the Indiana Court of Appeals, in a
published opinion, affirmed in part and reversed in part, the Order of the
Marion Superior Court. Department of Natural Resources v. Hoosier
Environmental Council (“IDNR v. HEC”), 831 N.E.2d 804 (
[VOLUME 10, PAGE 326]
14. The Indiana Court of Appeals held that “the question
of eligibility is a matter of law that could be determined by the trial court,
the entitlement question was a factual question that was inappropriate for
determination by the trial court on judicial review.” Id., citing West Virginia Highlands
Conservancy v. Norton (“WVHC”), 343 F,3d 239, 248, (4th Cir.
2003). In so holding the Indiana
Court of Appeals further stated;
[t]he NRC is the “ultimate authority” of the DNR,
subject to certain exceptions not applicable here… In this case the NRC
dissolved the special ALJ’s non-final order and made its own findings and
conclusions, ultimately deciding that HEC was not eligible for fees under
Indiana Code Section 14-34-15-10, a decision the DNR now concedes was
erroneous. Thus, the NRC never reached
the issue of whether HEC is entitled to fees under I-SMCRA. Rather than remanding the matter to the NRC,
the trial court substituted its judgment for the NRC and essentially adopted
the special ALJ’s findings and conclusions.
The trial court erred in so doing.
Id., citing West
Virginia Highlands Conservancy v. Norton (“WVHC”), 343 F,3d 239, 248, (4th
Cir. 2003).
15. Consequently, the Indiana Court of Appeals affirmed
the Marion Superior Court’s determination that HEC is eligible for an award of
fees, but reversed and remanded to the Commission for further proceedings that
portion of the trial court’s order that determined HEC was entitled to an award
of fees.
16. The Marion Superior Court issued its “Order of Remand”
consistent with the Indiana Court of Appeals opinion on December 15, 2005.
REMAND
17. In an effort to expedite the resolution of the Fee
Proceeding, following notification of the Indiana Court of Appeals decision,
but before receipt of the Marion Superior Court’s “Order of Remand,” a status
conference was scheduled and held on November 15, 2005.
18. HEC was invited to supplement its fee petition to
address additional fees incurred between May 31, 2002 and the present with
respect to its prosecution of its fee petition.
HEC represented its intention to pursue any additional fees in a second
proceeding following the conclusion of the case at bar. Report
of Status Conference, November 18, 2005.
[VOLUME 10, PAGE 327]
19. The parties each availed themselves of the opportunity
to file briefs and proposed orders as well as responses.
20. Oral argument was heard on February 7, 2006.
ISSUES FOR DETERMINATION ON REMAND
21. The determination of an award of fees under I-SMCRA
involves a two-prong analysis. IDNR v. HEC, and WVHC,
including first a determination of the petitioner’s eligibility for such fee award and second the petitioner’s entitlement to an award of fees.
22. The Marion Superior Court previously determined that
HEC is eligible to receive an award of fees herein and the Indiana Court of
Appeals affirmed that determination. IDNR v. HEC. As such, further analysis of HEC’s
eligibility will not be undertaken here.
23. Remaining, however, is a determination as to the
second prong of the analysis, or HEC’s entitlement to an award of fees.
24. If the issue of HEC’s entitlement is answered in the
affirmative, the task of ascertaining the proper amount of such fee award must
then be undertaken.
25. Fees associated with the entirety of the Foertsch
Litigation are at issue herein, however, HEC has opted to have only those fees
associated with its Fee Proceeding accruing up to May 31, 2002 considered.
FRAMEWORK FOR DETERMINING FEE PETITIONER’S ENTITLEMENT TO FEES[2]
26. The instant proceeding presents an issue of first
impression for the Commission and the State of
27. IC 14-34-15-10 states:
Sec. 10. Whenever an order is issued:
(1) under this chapter or under IC 13-4.1-11 (before its repeal); or
(2) as a result of an administrative proceeding under this article or
under IC 13-4.1 (before its repeal) instituted at the request of a person;
the court, resulting from judicial review, or the commission may assess against
either party to the proceeding an amount of money, determined by the
commission, equal to the aggregate amount of all costs and expenses, including
attorney's fees, reasonably incurred by the person for or in connection with
the person's participation in the proceedings, including any judicial review of
agency actions.
[VOLUME 10,
PAGE 328]
28. 312 IAC 3-1-13 states in relevant part:
Sec. 13 (a)
This section governs an award of costs and expenses reasonably incurred,
including attorney fees, under … IC 14-34-15-10.
…
(d)
Appropriate costs and expenses, including attorney fees, may be awarded under
IC 14-34-15-10 only as follows:
…
(2) To a
person from the department, other than to a permittee or the permittees’ authorized
representative, who initiates or participates in a proceeding and who prevails
in whole or in part, achieving at least some degree of success on the merits,
upon a finding that the person made a substantial contribution to a full and
fair determination of the issues.
…
29. One purpose of I-SMCRA is to “[i]mplement and enforce
the federal Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1201
through 1328).” IC 14-34-1-3(1).
30. Within the federal Surface Mining Control and
Reclamation Act (F-SMCRA) a similar
fee shifting statute states:
Whenever an order is issued under this section, or as
a result of any administrative
proceeding under this chapter, at the request of any person, a sum equal to the
aggregate amount of all costs and expenses (including attorney fees) as
determined by the Secretary to have been reasonably incurred by such person for
or in connection with his participation in such proceedings, including any
judicial review of agency actions, may be assessed against either party as the
court, resulting from judicial review or the Secretary, resulting from administrative proceedings,
deems proper.
30 U.S.C.
1275(e).
31. Under the “American Rule” absent statutory authority
there is ordinarily no entitlement for the successful litigant to collect
attorneys’ fees from another party. WVHC, supra.
32. Pursuant to 30 U.S.C. 1275(e), and similarly IC
14-34-15-10, there is an express statutory ability to award fees to successful
parties for the purpose of assuring “public participation in the “development,
revision and enforcement of regulations, standards, reclamation plans, or
programs established by the Secretary or any State under [the Act].” Id at 242.
[VOLUME 10, PAGE 329]
33. Because the instant proceeding is one of first
impression in
34. Three federal cases, WVHC, supra, Kentucky Resources Council, Inc. v Babbitt
(“Babbitt”), 997 F. Supp. 814, (E.D. Ky. 1998) and Utah International,
Inc. v. Department of Interior (“Utah International”), 643 F. Supp. 810,
(D. Utah 1986), involving varying aspects of the fee shifting provisions
contained within F-SMCRA are integral to understanding the equivalent
provisions of I-SMCRA.
35. In WVHC,
the plaintiffs sought an award of fees relating to their initiation of and
participation in underlying litigation involving F-SMCRA from the Interior
Board of Land Appeals (IBLA). The IBLA denied the plaintiffs’ request on
the basis that the plaintiffs were not eligible for an award of fees. The United States District Court for the
Southern District of West Virginia, on appeal brought by the plaintiffs,
reversed the IBLA’s determination, finding that the plaintiffs were both
eligible and entitled to an award of fees.
On further appeal by the IBLA, the United States Court of Appeals for
the Fourth District affirmed the District Courts’ finding that the plaintiffs
were eligible for an award of fees but vacated and the District Court’s finding
that the plaintiffs were entitled to those fees and remanded the entitlement
issue back to the IBLA. Similar to the
instant case, the Court of Appeals determined that the IBLA had not, in
rendering its denial of the plaintiffs’ fee petition, made findings with
respect to the plaintiffs’ entitlement to an award of fees and that the
District Court’s determination of that issue was improper as the issue of
entitlement must first be addressed by the IBLA.
36. WVHC discusses the established framework for determining
an entity’s entitlement to a fee award under F-SMCRA but fails to reach issues
relating to the application of that framework to a particular factual
situation.
37. Application of the F-SMCRA fee-shifting framework is
discussed at some length, however, in Utah
International and Babbitt,
in which the issue of entitlement was ripe for review.
38. In WVHC
the fee shifting provisions of F-SMCRA are categorized as “whenever
appropriate” statutes, or statutes that “allow the award of fees to any party
whenever the court or agency determines an award to be appropriate.” at 244.
39. An agency is not however, entitled to exercise
unfettered discretion in determining the appropriateness of a fee award. WVHC,
at 244.
[VOLUME 10, PAGE 330]
40. A determination of a party’s eligibility for an award
of fees does not mandate an affirmative conclusion with respect to that party’s
entitlement to such fee award. Utah International, supra, citing Hensley
v. Eckerhart, 461
41. In nearly identical fashion to regulations adopted to
implement F-SMCRA’s fee shifting provision in a manner consistent with Ruckelshaus, 312 IAC 3-1-13(d)(2)
allows the Commission to order the Department to pay fees to a party, other
than the permittee, when it is determined that (1) the party “prevails in whole
or in part, achieving at least some degree of success on the merits, and (2)
“upon a finding that such person made a substantial contribution to a full a
fair determination of the issues.” WVHC,
at 245 citing Ruckelshaus, 43
C.F.R. 4.1294(b).
42. Based upon the language of 43 C.F.R. 4.1294(b), and
similarly 312 IAC 3-1-13(d)(2), the fee petitioners establishment of “achieving
at least some degree of success on the merits” is determinative of the first
prong, or the eligibility requirement, of the test. Id at 245.
43. The second prong of the test, or a fee petitioners’
entitlement to a fee award, however relies upon a determination that the
petitioner “made a substantial contribution to a full and fair determination of
the issues.” Id at 247.
44. Following the affirmation that a fee petitioner has
achieved some degree of success on merits (establishing eligibility) and that
the fee petitioner substantially contributed to the full and fair determination
of the litigation (establishing entitlement), it is necessary to evaluate the
reasonableness of the fees sought as compared to the actual successes of the
fee petitioner in the underlying litigation. Utah International, Save Our Cumberland Mountains, Gateway,
Natural Resources Defense Council, and Sierra Club, supra.
45. WVHC explains that the IBLA which serves, for the United
States Department of the Interior’s Office of Surface Mining Reclamation and
Enforcement (OSM) under F-SMCRA, a
function similar to that of the Commission for the Department’s Division of
Reclamation under I-SMCRA, has previously held that “the key to a finding of
substantial contribution is ‘the existence of a causal nexus between
petitioners’ actions in prosecuting the Board appeal and the relief obtained.’” WVHC at
247, citing W.
46. The causal relationship necessary to a determination
of entitlement is clarified through a review of Babbitt and Utah
International.
[VOLUME 10, PAGE 331]
47. In Babbitt,
the plaintiff citizens organizations sought, through citizens’ complaints filed
with OSM, to require OSM to take enforcement action relating to coal mining
activities violative of
48. The citizen organizations filed their petition for
fees citing the success of their complaint and appeal in addressing OSM’s
shortcoming with respect to the timeliness and efficiency in conducting
investigations of citizens’ complaints.
Initially, the IBLA determined that the plaintiffs were eligible for an
award of fees but had failed to establish a causal nexus between the policy
changes adopted by OSM and the plaintiffs’ appeal. Babbitt,
supra.
49. On appeal, in reversing IBLA’s entitlement decision
the court states,
A comparison of the First and Second Memoranda issued
by OSM reveals a striking dissimilarity.
Far more extensive procedural relief was obtained by the plaintiffs
through the issuance of the Second Memorandum.
To say that this relief was foreshadowed by the First Memorandum or the
subsequent informal review decision, which promised only to “consider”
unspecified additional relief, gives OSM too much and plaintiff to little. Nor can the procedural relief obtained by the
plaintiffs after they filed their appeal be said to be inconsequential merely
because the substantive issues had previously been resolved. The procedural relief outlined in the Second
Memorandum is far-reaching in both scope and application. The timing alone of the issuance of the
Second Memorandum raises an inference that plaintiffs’ appeal was causally
related to the relief obtained.
…
What should have been a prompt investigation by the
LFO (OSM’s Lexington Field Office) of an easily determinable fact (Branham
& Baker’s ownership interest in
Babbitt at 820.
[VOLUME 10,
PAGE 332]
50. The Babbitt
case having resulted from an appeal of the IBLA’s determination that the
plaintiffs were not entitled to an award of fees, a decision by IBLA regarding
an appropriate fee award had not been determined and the matter was remanded
for this sole purpose.
51. Utah
International relates to an
initial determination as to the plaintiffs’ eligibility for and entitlement to
an award of fees as well as the determination as to the proper fee to be
awarded.
52. In Utah
International, the Secretary of the Interior issued a decision,
supported by environmental organizations, designating a land area unsuitable for
mining operations. Judicial review
challenging the Secretary’s decision followed, during which the government and
the environmental organizations were, in part, aligned. A part of the judicial review included
cross-claims and counter claims filed by the environmental organizations
seeking that a larger land area be included in the unsuitability
designation. During the pendency of the
judicial review the government moved for the unsuitability designation to be
remanded to the Secretary for reconsideration to which the environmental
organizations filed objections.
Additional litigation and negotiations, which ultimately yielded results
consistent with the majority of the claims raised by the environmental
organizations, resulted in the voluntary dismissal of most of the claims.
53. The environmental organizations sought an award of
fees for their work during the entirety of the administrative proceedings in
which they supported the Secretary’s initial unsuitability designation and the
judicial review challenging that designation.
Matters at issue upon which the environmental organizations differed
from the government involved their cross claims and counterclaims and their
opposition to the government’s sought remand to the Secretary for
reconsideration of the unsuitability designation.
54. While the court in Utah
International, does not clearly express the two-prong test involving
the eligibility and entitlement of a fee petitioner, the analysis is consistent
with the application of that framework.
55. Again relying upon Ruckelshaus,
supra, the court determined that “absent ‘some degree of success on the
merits by the claimants’” a fee petitioner is not eligible for such an award. [3] Utah International, supra at 817.
[VOLUME 10, PAGE 333]
56. With respect to the fee petitioners’ entitlement to an
award, the court relies upon Hensley,
supra and its’ holding that eligibility for an award of fees does not
mandate an affirmative determination of entitlement.
.
57. It was determined that the environmental organizations
were “successful in their role as defendants, in that they successfully
maintained the existing unsuitability designation. They were not successful in their
cross-claims and counterclaims in that those claims were all dismissed.” The ultimate outcome being the execution of a
settlement in which “the status quo was essentially maintained” it was
determined that an award of fees for those efforts would be improper.
58. However, the Court determined that during judicial
review the environmental organizations did successfully defeat the government’s
motion to remand the unsuitability designation back to the Secretary for
reconsideration and as such were entitled to fees for that portion of the
proceeding. Id at 828.
59. The method employed for determining entitlement to an
award of fees in both Utah
International and Babbitt
involved of the division of the litigation into phases and the separate
consideration as to the causal nexus of the fee petitioner’s activities and the
outcomes of each phase.
60. If it is determined that a fee petitioner is entitled
to an award of fees, the difficult task of assessing the reasonableness of the
fee award must be undertaken. Natural Resources Defense Council, Inc.,
et al v. Office of Surface Mining Reclamation and Enforcement, et al., 107
IBLA 339, (1989), Utah International, supra, Gateway Coal Co. v.
Office of Surface Mining Reclamation and Enforcement, 131 IBLA 212, (1994).
HEC’S ENTITLEMENT TO A FEE AWARD
61. The determination of HEC’s entitlement to an award of
fees relating to its initiation of and participation in the Foertsch Litigation
begins with a review of HEC’s actions in the prosecution of those proceedings
and the final outcomes achieved as a result of those actions.
[VOLUME 10, PAGE 334]
62. At issue was Foertsch’s permit amendment, designated
by the Department as S-312-1. The
Department’s approval of S-312-1 authorized Foertsch to dispose of coal
combustion waste (CCW) from a power
company on the Little Sandy #10 Mine in monofills and layered with spoil. The permit amendment allowed for CCW to be
disposed of at a tonnage equal to the tonnage of coal removed, or a rate of
1:1.
63. HEC, based upon various allegations of error in
approving S-312-1, sought revocation of the permit and a stay of effectiveness
of the permit.
64. HEC’s allegations of error relating to the approval of
S-312-1 were set forth in detail it its petition for review as follows:
…
7) The permit fails to meet the requirements of ISMCRA
(IC 13-4.1) and its regulations and does not comply with requirements to supply
information, characterize the site and its interactions with CCW and monitor
the disposal of CCW that are found in Memorandum 92-1.
8) The permit fails to define or characterize the
premining hydrologic balance as required by ISMCRA and its regulations. The premining hydrologic balance has also not
been defined or characterized by the mining permit, #S-00312, that is being
amended by this permit.
9) Three aquifers have been identified by monitoring wells
in the permit area, but the permit fails to characterize any of them as
required by ISMCRA and its regulations.
Bail tests done for the permit revealed sufficient water in these
aquifers to readily provide domestic water supply for multiple residences making
them aquifers that must be characterized and protected under ISMCRA.
10) The permit does not provide adequate site specific
data about the permeability of strata in the mine or the hydrology of the mine
area as required by Memorandum 92-1 and ISMCRA.
The extent of aquifers, direction of ground water flow and rate of flow
of ground water has not been determined correctly or to any degree in most
instances as required by Memorandum 92-1 and ISMCRA. The permit fails to place monitoring wells in
positions that will monitor down gradient or up gradient water from the CCW
disposal areas as required by Memorandum 92-1 and ISMCRA. The permit does not include six months of
baseline ground water monitoring data as required by Memorandum 92-1 and
ISMCRA.
11) The permit will deliberately place millions of tons of
toxic-forming material into direct contact with ground water in the Little
Sandy #10 Mine in violation of ISMCRA and its regulations which prohibit such
contact.
[VOLUME 10, PAGE 335]
12) The permit provides no analysis, detailed
approximations or even projections of the leachate that will form in the coal
combustion waste (CCW) disposal areas.
The permit has no detailed discussion of the geochemistry that will take
place as a result of CCW disposal as required by Memorandum 92-1 and ISMCRA.
13) The permit provides no plan to monitor and avoid
impacts to the offsite hydrologic balance as required by ISMCRA and its
regulations. Such a plan would include
monitoring groundwater at this mine down gradient from the disposal sites once
the postmining equilibrium of groundwater flow has been established so that
monitoring wells on the perimeter of the disposal areas will monitor more than
just ground water flowing into the mine.
The permit does not attempt to determine when this point in time will
occur and hence provides for no monitoring of groundwater at the Little Sandy
#10 Mine at this point in time. Evidence
from other mine dewatering operations implies that a much greater length of
time will be needed to monitor down gradient water from the disposal areas at
this mine than the period provided by the release of bonds for surface
revegetation.
14) The permit includes no plan to minimize or remediate
adverse impacts to the offsite hydrologic balance as required by ISMCRA and its
regulations. The permit establishes no
levels of contamination of ground water which if surpassed will trigger or
require any remedial activity.
15) The permit is not complete. ISMCRA and its regulations require that only
administratively and technically complete permits be issued so that a
determination can be made that the protection of the hydrologic balance has
been assured and all other requirements of ISMCRA are being adhered to by the
permit. The following are examples of
the permit’s violation of this requirement:
·
The permit does
not include any current ash leaching data from the generators of ash that will
be disposed at this site.
·
The copy of this
permit provided to HEC by the Division of Reclamation after the permit was
issued, (which copy was paid for by HEC) includes no information that
characterizes the combustion and pollution control processes that produce the
ash from one of the generators.
·
Additionally the
permit does not include data from six months of baseline ground water quality
monitoring, or any information about the background water quality or water
levels to have been measured by the monitoring well that was to be installed
near drill hole #3. All of this
information and much additional information which was requested as modifications
to the permit in a letter dated January 17, 1995 and signed by Michael
Sponsler, Director of Division of Reclamation, is not in the final permit as
issued on May 10, 1995.
[VOLUME 10, PAGE 336]
·
Similarly rather
than committing to final drainage ways and surface land contours required under
ISMCRA and its regulations to be shown on a final contour map, the permit
states that disposal needs and requirements will allow the operator to alter
(to an unspecified extent) final contours, post mining drainage ways and even
the locations of monofills as the CCW disposal operation proceeds.
16) The permit is based upon statements and data known to
be inaccurate in violation of ISMCRA and its regulation. For example IDOR staff concede that much of
the baseline ground water quality monitoring data in the permit for CCW
monitoring wells #2 and #3 is of very questionable value and probably resulted
from improper methods and procedures being used to take samples from the
wells. The permit is replete with other
examples of inaccurate and/or completely incorrect statements or
assertions.
…
HEC’s Petition for Review, filed June 9, 1995, pages
2-4.
65. The Teeguarden Non-Final Order summarized the issues
to be determined as follows:
a. Whether or not the petition for review was timely
filed.
b. Whether or not collateral estoppel applies to a number
of issues.
c. Whether or not there is an adequate characterization
of pre-existing geological and hydrological conditions.
d. Whether or not the monitoring wells are sufficient in
number, construction, and design.
e. Whether or not there is adequate isolation and
separation of the CCW to prevent damage from occurring.
f.
Whether or not
the lack of compliance criteria should invalidate the permit.
g. Whether or not there should be a mechanism in the permit
to restrict further land use or caution future buyers.
h. Whether or not the amount of CCW to be back filled
should bear some relationship to the amount of coal extracted.
i.
Whether or not
some mechanism must be in place to require long term monitoring of the site.
j.
Whether or not
the testing of the proposed waste was adequate.
Teeguarden
Non-Final Order, page 4.
66. The administrative review of S-312-1 continued for a
period of sixteen (16) months, eventually requiring a twelve (12) day
administrative hearing, the testimony of numerous “highly qualified biologists,
hydrogeologists, chemists, geochemists and toxicologists and approximately 275
pages of briefs.” Teeguarden Non-Final Order and HEC v. DNR and Foertsch Construction
Company, Inc., 7 CADDNAR 162, (February 1997).
[VOLUME 10, PAGE 337]
67. It is not disputed that HEC was the sole complaining
party in the action, which was adverse to both the Department and Foertsch, who
were aligned in defense of S-312-1.
68. Whether one considers HEC’s allegations regarding the
impropriety of the Department’s approval of S-312-1 as stated in its original
petition for review or as the substantive and procedural issues were summarized
in the Teeguarden Non-Final Order, it is clear that HEC’s primary concerns
related to the impacts of disposal of CCW upon ground water and surface water
within the area of the Little Sandy #10 Mine.
69. ALJ Teeguarden included the following four additional
conditions on S-312-1, each of which involves surface water and ground water
issues raised by HEC:
·
…Place a
condition on the permit requiring the mine to record an affidavit with respect
to the fact that CCW has been stored on the property after storage has
commenced for every coal lease involved in the disposal.
·
…Disposal
pursuant to 92-1 should be restricted to an amount approximately equal to the
ash created by the coal removed or in this case, approximately 25% of the total
disposal tonnage approved in this permit.
·
…Include a
condition in the permit which requires complete recharge of the groundwater in
and near the permit area and stabilized post-mining flow before any petition
for final bond release can be considered.
·
…Include a
condition that no CCW may be stored until consistent, meaningful, baseline data
on groundwater for six separate months has been provided to the department.
Teeguarden Non-Final Order, findings 165, 185, 194 and
223 and Part IV.
70. Each of the four conditions established in the
Teeguarden Non-Final Order resulted from HEC’s initiation of and participation
in the Administrative Review Phase.
71. HEC’s intent in initiating its administrative review
of S-312-1 was to establish the amendment’s failure to meet the requirements of
F-SMCRA or I-SMCRA in order to achieve its revocation. HEC
Post Hearing Brief, page 87, HEC Petition for Review.
72. HEC obviously did not achieve one hundred percent
(100%) success during the litigation associated with S-312-1.
[VOLUME 10, PAGE 338]
73. The Teeguarden Non-Final Order was subsequently
modified after the parties filed objections with the AOPA Committee of the
Commission.
74. The AOPA Committee’s substantive modifications
increased the amount of CCW that could be disposed to fifty percent (50%), by
tonnage, of the coal removed.
75. To establish entitlement, HEC must only prove that its
actions are causally related to the outcomes.
WVHC, Babbitt, Utah
International, supra.
76. Without doubt HEC’s actions of initiating and
participating in the Foertsch Litigation bears a direct causal nexus with the
four conditions imposed upon S-312-1.
77. Thus, HEC is entitled to an award of fees.
REASONABLENESS OF HEC’S SOUGHT FEES
78. Consistent with Utah
International and Babbitt
the entire proceeding for which HEC is seeking fees is divided into the
following four phases:[4]
·
“Administrative
Review Phase,” which commenced on June 9, 1995 and concluded with the
issuance of the Teeguarden Non-Final Order on October 6, 1996.
·
“Commission
Objections Phase,” which commenced on October 7, 1996 and concluded with
the issuance of the Commission Order on February 19, 1997.
·
“Judicial
Review Phase,” which commenced on February 20, 1997 and concluded on
September 13, 1999.
·
“Fee Petition
Phase,” which commenced on March 24, 1997 and continues herein. However, at HEC’s request, only those fees
incurred on or before May 31, 2002, associated with this phase will be
considered.
79. The instant proceeding involves a situation in which
HEC was only partially successful on the merits of the Foertsch
Litigation. Dissimilar to Save Our Cumberland Mountains, supra, but similar
to Utah International, supra, and Sierra Club, et al. v. U.S.
Environmental Protection Agency, et al., 769 F.2d 796, (1985).
80. That HEC was partially successful on the merits of the
Foertsch Litigation says “little about whether the expenditure of counsel’s
time was reasonable in relation to the success achieved.” Utah International, supra, citing Hensley v. Eckerhart,
461 U.S. 424, 436-437.
[VOLUME 10, PAGE 339]
81. Herein, while HEC is entitled to fees for each phase
of the Foertsch Litigation, the method undertaken in determining the
reasonableness of the fees sought by HEC is to consider HEC’s success, or lack
of success, with respect to each identified phase.
82. The theory of success based determination of
reasonable fees to be awarded is explained, on the basis of Hensley, in Sierra Club, supra,
Where
a petitioner obtains excellent results, his attorneys’ fees should be “fully
compensate” for the hours worked; where the petitioner has obtained only
partial or limited success, his attorneys should not be fully compensated.
In
the instant case, the petitioners achieved a modicum of success on some but not
all of the issues that they raised, and thus were granted some but not all of
the relief they requested. The
petitioners therefore deserve attorneys’ fees for some but not all of the time
that they have expended in this litigation.
at
802.
83. The administrative law judge, at oral argument held on
February 7, 2006, cited Farrar v.
Hobby, 506 U.S. 103, 114 (1992) for the premise that “’the degree of
the plaintiff’s overall success goes to the reasonableness’ of a fee award…”
84. HEC, in its “Further Written Response of Hoosier
Environmental Council, Inc. To Questions and Comments at Oral Argument of
Presiding Administrative Law Judge” attempts to distinguish Farrar because at issue there was
a Section 1983 action. HEC states that
“Farrar has simply not been applied by either the United States Supreme Court
or the lower federal courts in the context of “whenever appropriate” fee-shifting
statutes such a SMCRA…”
85. While HEC is accurate that Farrar has not been directly applied to F-SMCRA fee-shifting
provisions, Hensley’s, like Farrar’s, degree of success based
reasonableness of fee determination is based, is cited routinely in F-SMCRA
precedent setting cases. Utah International, Save Our
Cumberland Mountains, Inc., supra.
86. A discussion of HEC’s overall success, or lack thereof,
with respect to each separate issue relating to each phase of the Foertsch
Litigation is relevant to a determination of the reasonableness of a fee award
to HEC. Sierra Club, supra.
ADMINISTRATIVE REVIEW
PHASE
87. The Department argues that it should not be
responsible for HEC’s fees associated with item “a,” identified in the
Teeguarden Non-Final Order, because Foertsch, not the Department, initiated and
solely prosecuted the claim that HEC’s petition for administrative review was
untimely filed.[5]
[VOLUME 10, PAGE 340]
88. The Department’s contention is well taken and is
supported by decisions of the Interior Board of Land Appeals. Gateway
Coal Co. v. Office of Surface Mining Reclamation and Enforcement, 131 IBLA 212,
(1994).
89. However, within the context of previous Commission
decisions, such an outcome would work an injustice because while Foertsch
raised the issue of timeliness relating to HEC’s petition for review, as the
regulatory authority over I-SMCRA, the Department would have benefited from a
dismissal of the proceeding on Foertsch’s motion if Foertsch had succeeded. Hazelett,
et al. v. Walbridge, et al. and Department of Natural Resources, 10 CADDNAR
39,42, (2005) and Wheeler, et al. v. Peabody, Department of Natural
Resources and Town of Zionsville, 9 CADDNAR 193, 194, (2004).
90. The Department additionally argues that items “a” and “b,”
as identified in the Teeguarden Non-Final Order, are merely “procedural
victories” that do not justify an award of fees pursuant to Ruckelshaus as affirmed by Utah International.
91. Contrary to the Department’s position, Utah International actually
supports the award of fees for procedural victories, where those victories are
“integral” to a party’s achievement of success on the merits of its claim. at 828.
92. “It is often the case that one or more procedural
victories are behind a substantive victory,” thus the Department’s challenge to
an award of fees to HEC for its success in overcoming the challenge to the
timeliness of HEC’s petition for review and challenges based upon collateral
estoppel is without merit.
93. HEC’s success as to the procedural attacks allowed for
full administrative review on the merits, which resulted in the modification to
S-312-1. As such HEC’s procedural
victories were integral to HEC’s success on the merits.
94. At the heart of HEC’s substantive issues associated
with the Foertsch Litigation is the disposal of CCW, a solid waste regulated by
the Environmental Protection Agency (EPA).
Teeguarden Non-Final Order. While CCW had not be characterized as a
hazardous waste by EPA, “HEC’s major concerns deal with the effect of stored
CCW on area ground water and surface water,” Id at 164, and it was determined that an “examination of CCW
storage must consider the following: a)
What RCRA metals and other water quality degrading materials are present? b)
What quantity of each potentially harmful element is present? c) What is the mobility of the potentially
harmful materials: and d) Are any materials present in the spoil that will
react with the CCW in such a way as to cause a problem?”
[VOLUME 10, PAGE 341]
95. HEC’s petition for review can be generally encapsulated
as seeking the 100% prohibition of CCW disposal under S-312-1 in light of the
possible interaction of CCW with existing conditions and the relationship of
these events to identified aquifers readily able to provide domestic water
supplies.
96. Without question, the most significant of HEC’s
victories with respect to the Administrative Review Phase was the determination
that the tonnage of CCW disposed be restricted to approximately one-quarter of
the tonnage of coal removed. This
determination, while modified during the Commission Objection Phase (discussed infra), resulted in a
material alteration of the Department’s policy with respect to its review of
all CCW disposal permit applications.
97. Secondary substantive victories achieved by HEC were
the requirement that Foertsch record an affidavit advising future landowners of
the CCW disposal activity, the delay of final bond release until Foertsch has
allowed a complete recharge of the groundwater in and near the permit area and
stabilized post-mining flow, and the addition of a condition that no CCW may be
stored until consistent, meaningful, baseline data on groundwater had been
provided by Foertsch to the Department.
98. However, HEC achieved absolutely no success in its
efforts directed towards the sufficiency of Foertsch’s characterization of
pre-existing geological and hydrological conditions, the sufficiency of
monitoring wells, the adequacy of isolation and separation of the CCW, the need
for long-term site monitoring and failed to achieve a 100% prohibition on the
disposal of CCW.
99. The difficulty with the determination of
reasonableness of the fees sought by HEC for the Administrative Review Phase is
a determination whether the individual issues upon which HEC achieved success
are related to the individual issues on which HEC was entirely
unsuccessful.
100.
“Where a
plaintiff presents in one lawsuit ‘distinctively different claims for relief
that are based on different facts and legal theories’, the court cannot allow a
plaintiff to recover fees on the unsuccessful claims: ‘The congressional intent to limit awards to
prevailing parties requires that these unrelated claims be treated as if they
had been raised in separate lawsuits, and therefore no fee may be awarded for
services on the unsuccessful claim.” Sierra Club, supra at 801.[6]
101.
There is no
question that all of HEC’s claims in the Foertsch Litigation involve the same
legal theory, however it must be examined whether each of HEC’s raised issues
involves the same facts.
[VOLUME 10, PAGE 342]
102.
To accomplish
this task, a review of HEC’s substantive victories as identified in the Teeguarden
Non-Final Order is particularly enlightening.
103.
In determining
that pre-mining geological and hydrological data provided with the application
for Permit S-312-1 was adequate, ALJ Teeguarden considered in great detail the
manner in which natural groundwater flows through strata of varying degrees of
permeability and the consideration that mining of any form destroys those strata. In post mine areas the material originally
contained within the strata, be it sandstone, limestone, etc., remain present
but in boulder form thereby allowing groundwater flow to occur more easily
through faults and fissures between the boulders instead of through permeable
strata existing before mining occurred.
104.
In determining
that the number, design and construction of the groundwater monitoring system
applicable to S-312-1 was adequate, ALJ Teeguarden continued his exploration of
groundwater flow through post-mined land areas and concluded that an “active
mine site will destroy the (groundwater) zone in the area of active
mining.”
105.
ALJ Teeguarden,
in furtherance of his determination relating to the sufficiency of the
groundwater monitoring system further concluded that the massive pumping of
groundwater from active mine operations allows old mine areas to resaturate or
“recharge.” “Until total recharge
occurs, the groundwater flow will be towards the sink created by the pumping…” It was concluded that total “recharge” of the
groundwater is measured in “decades rather than months or years” and may be
continually impacted by other ongoing mining or even large scale agricultural
irrigation.
106.
In essence, ALJ Teeguarden
agreed that a monitoring system surrounding the mine area was more appropriate
that the “zone” monitoring supported by HEC.
107.
A comparison of
the evidence considered on HEC’s unsuccessful claims, reveals that the
considerations made by ALJ Teeguarden are directly related to his conclusions
on the issues to which HEC lays victorious.
108.
It is clearly the
case that ALJ Teeguarden, while determining that S-312-1 allowed for sufficient
isolation and separation of the CCW from groundwater exposure, such isolation
and separation techniques were adequate only when the amount of CCW disposal
was reduced.
[VOLUME 10, PAGE 343]
109.
The evidence
discussed by ALJ Teeguarden with respect to groundwater “recharge” obviously
bears a direct connection to the imposition of a condition that final bond
release not be authorized until full “recharge” had occurred.
110.
ALJ Teeguarden, in
reducing the amount of CCW disposal authorized by S-312-1, acknowledges the
“potential long term hazard” and “open invitation to a problem” caused by
placing CCW waste at a rate of 1:1 by tonnage with the coal that was
removed. In essence the evidence in the Administrative
Review Phase revealed that allowing CCW disposal in the ratio approved by
S-312-1 authorized the placement of four times the solid waste than was
extracted with the coal removal.
111.
Again, similar to
the interrelationship between issues upon which HEC achieved success and issues
that HEC failed to gain victory is ALJ Teeguarden’s determination that S-312-1
was approved absent “meaningful” baseline groundwater monitoring data. In footnote 14, ALJ Teeguarden explains that
“[t]he importance of baseline monitoring data for RCRA metals and other
substances of interest is that it is necessary to have a good idea of the
normal levels in the groundwater prior to CCW disposal. Only then does the CCW monitoring plan have validity
in that groundwater samples after storage can be compared to samples before CCW
is present. This line of analysis
clearly correlates to the evidence presented regarding the potential harmful
effects of CCW upon groundwater that was more extensively discussed in the
sections of the Teeguarden Order associated with the adequacy of the groundwater
monitoring system.
112.
No person can
dispute the conclusion that every issue HEC raised, whether it succeeded on
that individual issue or not, was interrelated involving considerations of
groundwater flow through mined and unmined land areas and the long term impact
of introducing CCW into that environment.
113.
As such there is
no means by which the issues raised by HEC can be characterized as
“distinctively different” such that a fee award for the Administrative Review
Phase should be reduced on the basis of the number of or the significance of
HEC’s success versus lack of success with respect to any individual issue.
[VOLUME 10, PAGE 344]
COMMISSION OBJECTION PHASE
114.
Following
issuance of the Teeguarden Non-Final Order, HEC, Foertsch, and the Department
filed objections with the Commission as authorized at IC 4-21.5-3-29. Foertsch’s
Statement of Specific Objections; Foertsch’s Memorandum in Support of Objections
to More Restrictive CCW Volume Limits (Issue H); DNR’s Request for
Consideration and Partial Objections to the Report, Findings of Fact, and
Nonfinal Order of the Administrative Law Judge; DNR’s Summary of Objections to
Nonfinal Order; Objections of Hoosier Environmental Council to Findings and
Order of Administrative Law Judge.
115.
Foertsch sought
to have the Commission strike twenty-three individual findings as well as the
conditions imposed upon S-312-1 by the Teeguarden Non-Final Order. Foertsch’s
Statement of Specific Objections, page 17.
116.
In a separate
filing, Foertsch separately supported its position that the CCW limitation
imposed by the Teeguarden Non-Final Order should be rejected or, in the
alternative, remanded for further proceedings.
Foertsch’s Memorandum in Support
of Objections to More Restrictive CCW Volume Limits (Issue H), page 7.
117.
The Department
sought to have the Commission provide guidance relating to Condition A [filing
of affidavits in the property records revealing the disposal of CCW] and
Condition B [the limitation of CCW that may be disposed] as well as have eight
(8) identified findings and a footnote stricken from the Teeguarden Non-Final
Order. DNR’s Request for Consideration
and Partial Objections to the Report, Findings of Fact, and Nonfinal Order of
the Administrative Law Judge, page 15.
118.
HEC cites
approximately seventy (70) findings and various footnotes contained within the
Teeguarden Non-Final Order with which it objected. Each of these findings represented matters associated
with each issue upon which HEC failed to achieve success during the
Administrative Review Phase. HEC
concluded that the Teeguarden Non-Final Order “improperly allows the permit to
be approved subject to conditions, rather than denying the permit until the
application is accurate and complete as required by I-SMCRA….” The intent of HEC’s objections is a clear
and continuing effort to obtain revocation of S-312-1 and the 100% prohibition
on CCW disposal. Objections of Hoosier Environmental Council to Findings and Order of
Administrative Law Judge.
119.
After the
conclusion of oral argument on the parties’ objections, the Commission Final
Order, which modified the Teeguarden Non-Final Order in two areas, was entered
on February 19, 1997. Commission Final Order, page 1.
120.
The Commission
Final Order deleted footnote #16, as requested by the Department but more
importantly modified the 75% restriction of CCW disposed by increasing the
total tonnage of CCW that may be disposed to fifty percent (50%), or one-half
the tonnage of coal being removed. Commission Final Order, page 1.
[VOLUME 10, PAGE 345]
121.
The increase in
the amount of CCW disposal is directly contradictory to HEC’s position with
respect to its objections before the Commission and directly in favor of
Foertsch.
122.
While in all
other respects the Teeguarden Non-Final Order was affirmed by the Commission,
the largest victory achieved by HEC in the Administrative Review Phase was
undoubtedly struck a diminishing blow by the Commission.
123.
HEC failed to
succeed with respect to any one of its seventy (70) identified objectionable
findings and as a result accomplished no additional achievements through its
objections filed with the Commission.
124.
In Utah International a similar
scenario emerged. The environmental
organizations, which defended a previously issued unsuitability designation,
also sought, through the filing of cross-claims and counterclaims, for the
increase in land area covered by that designation. The court determined that while the organizations
were successful as defendants in maintaining the status quo, they were
unsuccessful in the prosecution of the cross-claims and counterclaims. Consequently, they were not entitled to an
award of fees.
125.
HEC’s citation of
Save Our Cumberland Mountains,
supra, for the premise that it is improper to completely deny fees for a
phase of litigation in which it accomplished no substantive victories is misplaced
here.
126.
In Save Our Cumberland Mountains the
court was not wrangling with the issue of a partially successful party. In fact, the court notes that the plaintiffs
therein ultimately obtained an agreement “to the relief initially sought …” Id
at 1533.
127.
Additionally,
even in Save Our Cumberland Mountains
the court recognizes that “Section 307(f) of the Clean Air Act, 42 U.S.C. §
7607(f), in language almost identical to 30 U.S.C. § 1270(d), allows the court
to award reasonable attorneys’ fees “whenever
it determines that such award is appropriate.”[7] Id
at 1533, fn1, (emphasis added).
128.
HEC, in the Commission
Objections Phase, set out not only to defend its successes achieved in the
Administrative Review Phase but it also filed its own objections.
[VOLUME 10, PAGE 346]
129.
HEC’s objections
were far more extensive than either Foertsch’s or the Department’s objections.
130.
Yet, HEC failed
to achieve any additional accomplishments through its own objections and was
even unsuccessful in fully defending its previous success accomplished in the
Administrative Review Phase.
131.
In light of the
numerous bases upon which HEC filed objections to the Teeguarden Non-Final
Order and its utter failure to achieve any success whatsoever with respect to
those objections combined with HEC’s further inability to even maintain
entirely the seventy-five percent (75%) reduction in CCW disposal it achieved
during the Administrative Review Phase, while HEC is entitled to an award of
fees for its participation in the Commission Objection Phase, a determination
to grant such an award is simply unreasonable. Utah International, supra and Save Our Cumberland Mountains,
supra.
JUDICIAL
REVIEW PHASE
132.
Foertsch and HEC
each filed petitions for judicial review of the Commission Order in the Daviess
County Circuit Court on March 21, 1997. HEC’s Verified Petition for Judicial Review
and Foertsch’s Petition for Judicial Review of Agency Action and for Other
Relief.
133.
The Department,
while being a party of necessity to the judicial review, did not actively pursue
judicial review of the Commission Order.
134.
HEC sought
through judicial review to have the Commission’s actions identified as
arbitrary, capricious and an abuse of discretion for the reasons set forth in
its Objections before the Commission and because the “maximum allowable volume
of coal combustion waste adopted by the Commission is contrary to the
Commission’s findings.” HEC’s Verified Petition for Judicial Review,
paragraph 6.a. HEC more specifically alleged, in pertinent part, as
follows:
1. Without waiving any of the errors preserved by HEC’s
objections, the most basic errors of the Commission and of the Department of
Natural Resources in modifying and approving permit S-312-1, each of which
require reversal, are summarized as follows:
a
The Commission
arbitrarily doubled the maximum amount of coal combustion waste which the
Administrative Law Judge’s findings and recommended order would allow to be
dumped in the Little Sandy No. 10 Mine….
[VOLUME 10,
PAGE 347]
b
The Commission
erroneously found…that the permit application adequately characterized the
pre-existing geology and hydrology of the area which would be affected by the
permitted waste-dumping. …
c
The Commission
erroneously found that the monitoring wells are adequate in number,
construction and design to determine whether waters outside the permit area are
being or will be degraded by the coal combustion waste dump. …
d
The Commission
erroneously held that federal SMCRA and I-SMCRA allow the placing of coal
combustion waste in direct contact with ground water, and erroneously found
that spoil is a “barrier” which will isolate coal combustion waste from ground
water or will minimize any ground water contamination.
e
The Commission
erroneously held that the permit could not prohibit lowering the quality of
well water so much that it violates primary drinking water standards, and,
further, that the permit could not set any standards for compliance, failure of
which would constitute a permit violation requiring corrective action. …
f
The Commission
erroneously issued the permit with conditions, instead of denying the permit
until the application is accurate and complete as required by I-SMCRA, and
until the application demonstrates that surface and ground water will be
protected from pollution and will be degraded to the minimum possible extent.
HEC’s Verified Petition for Judicial
Review, pages 4-6.
135.
Again HEC
contested the Commission’s findings with respect to each and every issue upon
which it had failed during the Administrative Review Phase and the Commission
Objection Phase and once again set out to obtain a complete revocation of
S-312-1 and 100% prohibition on CCW disposal.
136.
Foertsch, while
specifically identifying certain areas of error committed by ALJ Teeguarden and
the Commission, sought for the Daviess County Circuit Court “to set aside the
erroneous findings of fact and/or conclusions of law and orders contained in
the ALJ Report and affirmed by the Commission; to declare the ALJ Report, as
affirmed by the Commission, to be null, void, unenforceable, and of no effect
with respect to the errors identified above; to set aside the erroneous
findings of fact and/or conclusions of law and orders made by the Commission as
a consequence of the Commission Action; to declare the Commission Action to be
null, void, unenforceable, and of no effect with respect to the errors
identified above; …” Foertsch’s Petition for Judicial Review of
Agency Action and for Other Relief, page 14. The errors identified by Foertsch, on
judicial review, pertain in large part to its objections presented during the
Commission Objections Phase including its belief that the Commission’s
restriction on the amount of CCW that could be disposed at the Little Sandy #10
Mine was arbitrary, capricious and an abuse of discretion.
[VOLUME 10, PAGE 348]
137.
HEC’s claims on
judicial review were again far more extensive than Foertsch’s.
138.
The Daviess
County Circuit Court denied the petitions for judicial review filed by both
Foertsch and HEC and affirmed, in all respects, the Commission Final
Order.
139.
HEC, during
judicial review, did succeed entirely in defending the Commission Final Order,
which is again tantamount to maintaining the status quo. However, HEC was entirely unsuccessful in
accomplishing any of its additional objectives on judicial review.
140.
Again, HEC’s
position in the Judicial Review Phase is far more similar to that of the
petitioners in Utah International,
who were partially successful, than it is to the position to the petitioners in
Save Our
141.
Furthermore, with
respect to the Judicial Review Phase, the Department was not an active party
and precedent exists to support the premise that the Department should not be
obligated to pay fees to another party for hours incurred litigating matters to
which the Department was not an active litigant. Gateway
Coal Co., supra and Natural Resources Defense Council, Inc., et al. v.
Office of Surface Mining Reclamation and Enforcement, et al, 107 IBLA 339,
(1989).
142.
Again, HEC’s
failure to achieve any success in the Judicial Review Phase in light of the
overall number of issues upon which HEC initiated its judicial review combined
with the clear evidence that during this phase HEC’s claims were being
litigated primarily, if not entirely, against Foertsch, it is unreasonable to
determine that HEC should be awarded any fees associated with the Judicial
Review Phase. Utah International, supra and Save Our Cumberland Mountains,
supra.
FEE PETITION PHASE:
143.
An award of fees
under F-SMCRA, and thus I-SMCRA, may include payment for costs incurred in the
preparation and prosecution of a petition for fees. Save
Our Cumberland Mountains, Inc. v. Hodel, 651 F. Supp. 1528, 1536, (D.D.C.
1986) and Utah International, at 831, citing Hernandez v. George,
793 F.2d 264, 269, (10th Cir. 1986).
[VOLUME 10, PAGE 349]
144.
Consequently, it
is reasonable to grant an award of reasonable fees incurred by HEC in
prosecuting the Fee Proceeding.
145.
However, in
situations, such as this, where fee petitioners are successful in obtaining a
“fraction of the fee award originally sought” they are also not “entitled to an
award for all of the time spent prosecuting the fee petition.”
146.
Therefore, HEC’s
award of fees for the Fee Petition Phase is determinable by awarding fees
consistent with the percentage of the fees recovered in the Foertsch Litgation.
Utah International, supra.
HEC’S CLAIMED COSTS AND EXPENSES, INCLUDING ATTORNEY
FEES:
147.
A review of HEC’s
fee submissions reveals that fees associated with the Administrative Review
Phase, the Commission Objection Phase, the Judicial Review Phase and Fee
Petition Phase are commingled and must be separated to ascertain the fees
associated with the phases to which HEC is entitled to an award, the Administrative
Review Phase and the Fee Petition Phase.
148.
First the total
amount of fees sought by HEC must be calculated. The amount of fees sought are calculated at
the maximum amount sought, despite HEC’s subsequent reductions or withdrawals
of certain fees, and at the maximum hourly rate sought.
149.
Monetary amounts
correlating to the following discussion are summarized at Appendix B.
150.
The total amount,
including expenses and attorney fees, requested by HEC for the Foertsch
Litigation and Fee Petition Phase is reasonably ascertainable from HEC’s
various affidavits and statements. Tender of Affidavits in Support of Fee
Petition, filed May 23, 2000; Tender of Affidavit of Hendrik Haitjema in
Support of Fee Petition, filed June 13, 2000; Verified Statement of Chris A.
Wrede, filed June 13, 2002; Verified Statement of Tim Maloney Re: HEC Payments
for Employee Time and Expenses, filed June 24, 2002; Verified Statement of Tim
Maloney Re: HEC Payments for Time and Expenses of Charles Norris, filed June
24, 2002; Verified Statement of Tim Maloney Re: HEC Payments for Vendor
Expenses, filed June 24, 2002, Verified
Statement of Michael A. Mullett, filed November 5, 2001; Verified Statement of
June M. Lyle, filed November 5, 2001; Supplemental Verified Statement of
Michael A. Mullett, filed November 15, 2001; Supplemental Verified Statement of
June M. Lyle, filed November 15, 2001; Second Supplemental Verified Statement
of Michael A. Mullett, filed June 13, 2002.
[VOLUME 10, PAGE 350]
Total Sought Attorney Fees
and Salaries of HEC Employees:
151.
Max E. Goodwin (Goodwin), of the Mann Law Firm who
served as HEC’s counsel of record throughout the Foertsch Litigation and a
portion of the Fee Proceeding, submitted his affidavit dated May 23, 2000. Tender
of Affidavits in Support of Fee Petition.
Goodwin stated that he had committed four hundred fifty eight (458)
hours and incurred expenses of $2,704.82.
152.
Goodwin stated in
his affidavit that “in noncontingent fee cases my standard hourly rate for my
services has since the early 1990’s, been $150.00 per hour…plus various hourly
rates for the services of other attorneys and paralegals in my law firm who
assist me. I have also used a rate of
$225.00 per hour, payable at the successful conclusion of a case, which
includes an allowance for the assistance I receive from my paralegal assistant
and other attorneys in my firm and the lack of any compensation until the
conclusion of the case.”
153.
Chris A. Wrede,
an associate in the Mann Law Firm, modified the expenses incurred to a total of
$3,057.59 and provided billing records in confirmation of Goodwin’s commitment
of 458 hours. Verified Statement of Chris A. Wrede.
154.
Goodwin further
acknowledges that Robert C. Fry, an attorney under employment by HEC, performed
most of the legal work in the years 1999 and 2000 and that Jeffrey Stant and
Matt Waldo, both of whom are also employees of HEC, were involved in
“marshaling the documentary evidence and expert witnesses, and helping me to
organize HEC’s full participation throughout the administrative proceedings.” Tender of Affidavits in Support of Fee
Petition.
155.
Robert C. Fry (Fry) confirms that as counsel for HEC,
he “assisted HEC’s attorney with legal research, writing and document review
through the entire judicial review process….”
Tender of Affidavits in Support of
Fee Petition.
156.
Jeffrey Stant (Stant),
HEC’s Executive Director, states that his involvement commenced in June 1995
throughout which time he “assisted HEC’s attorney in every aspect of this
permit challenge, including permit review, witness preparation, and preparation
of legal pleadings.”
157.
Matt Waldo (Waldo),
who was for all relevant times HEC’s Solid Waste Policy Director, “assisted
HEC’s attorney with expert witness preparation and review of hearing testimony
in HEC’s challenge to the coal combustion waste disposal permit…”
158.
It is appropriate
to “award fees based on the rates applicable at the time the services were
provided.” Save Our Cumberland Mountains, Inc., supra at 1537.
[VOLUME 10, PAGE 351]
159.
According to
billing records provided by the Mann Law Firm, Goodwin’s applicable rate was
$150.00 per hour. Verified Statement of Chris A. Wrede.
160.
Important to the
determination that Goodwin was charging HEC at his lower rate is Goodwin’s
acknowledgement that his increased rate of $225.00 per hour included paralegal
services, which according to Goodwin was provided by Fry, Stant and Waldo. Tender
of Affidavits in Support of Fee Petition.
161.
It is generally
recognized that an award of fees for the use of paralegals and law clerks is
reasonable and fiscally responsible due to the performance of tasks that might
otherwise be performed by attorneys at greatly increased hourly rates. Shell
Oil Co. v. Meyer, 684 N.E.2d 504, (Ind. App. 1997).
162.
There exists a
distinct split of authority with respect to awarding fees for the salaries of
an entity’s employees for assistance provided to outside counsel. Compare
Salisbury Laboratories, Inc. v. Merieux Laboratories, Inc., 908 F.2d
706, (11th Cir. 1990), which authorized an award of fees for
employees assisting outside counsel; and Burger King v. Mason, 710 F.2d
1480, (11th Cir. 1983), which refused to award fees for the salaries
of employees providing assistance to outside counsel.
163.
Without
attempting to opine in general on the split regarding the award of salaries for
employees assisting outside counsel, in this particular situation discretion
dictates that HEC’s employees’ salaries be allowed.
164.
HEC’s evidentiary
submission relating to Fry, Stant and Waldo confirm that the services they
provided equivocated the services of a paralegal. Tender
of Affidavits in Support of Fee Petition and Verified Statement of Tim
Maloney Re: HEC payments for Employee Time and Expenses.
165.
Goodwin’s billing
records indicate that Goodwin charged HEC his lower hourly rate, which did not
include charges for paralegal services.
166.
Consequently, an
award of fees to Goodwin at $150.00 (as opposed to his $225.00 rate, which
includes paralegal fees) requires that, in fairness, HEC be compensated the salaries
of those employees who fulfilled that paralegal function. (see discussion infra)
167.
However, this
rationale is inapplicable to the Fee Petition Phase following the appearance of
Mullett, Polk & Associates in March 2001.
168.
HEC has included
within its evidence in support of fees relating to the Fee Petition Phase,
expenses associated not only with Michael A. Mullett (Mullett) but also a
paralegal, law clerks, legal interns, graduate law clerks and an office
administrator. Verified Statement of
Michael A. Mullett, Verified Statement of June M. Lyle, Supplemental Verified
Statement of Michael A. Mullett, Supplemental Verified Statement of June M.
Lyle, Second Supplemental Verified Statement of Michael A. Mullett.
[VOLUME 10, PAGE 352]
169.
It is not reasonable
to conclude that the services of HEC employees were necessary or reasonable in
light of the team of actual legal professionals and paraprofessionals assembled
after the appearance of Mullett, Polk & Associates. Therefore, any fees requested by HEC related
to Fry, Stant and Waldo for the Fee Petition Phase that were incurred after
March 2001 will be excluded.
170.
In March 2001,
Michael A. Mullett (Mullett) of Mullett, Polk & Associates, replaced
Goodwin as the attorney of record and incurred fees and expenses relating
solely to the Fee Petition Phase.
171.
Mullet and his
paralegal, June M. Lyle (Lyle) submitted a total of five verified
statements and supplemental verified statements with billing records as
evidence of attorney fees, costs and expenses.
172.
The final
verified statement filed by Mullett “supercedes and replaces” the previous
verified statements and includes tabulation of all fees “from March, 2001 (when
Mullett & Associates first appeared in this matter), through May, 2002. Second Supplemental Verified Statement of
Michael A. Mullett.
173.
While Mullett’s
final verified statement claims a total of $29,825.56 in reasonable attorneys
fees, costs and expenses, simple calculation of the itemized fees equals only
$24,825.56, a five thousand dollar ($5,000.00) difference.
174.
The $5,000.00
discrepancy is undoubtedly the result of a retainer in that exact amount
identified by Mullett in his first verified statement. Verified Statement of Michael A. Mullett,
paragraph 8.
175.
The $5,000.00
retainer has been strenuously objected to by the Department and has been a
topic of countless briefs and debated at length. The Department’s objection is premised upon
the Indiana Rules of Professional Conduct, Rule 1.16(d), which requires that
all attorney fees be earned. The
Department supports its position by citing decisions requiring the refund of
any advance fee that has not been earned.
See
176.
Conversely, at
oral argument and in HEC’s post oral argument brief, it describes the $5,000.00
retainer as essentially a flat-fee for hours expended in advance of entering an
appearance in the instant proceeding and as such was earned.
[VOLUME 10, PAGE 353]
177.
Oral argument is
not a forum for the receipt of evidentiary material and evidentiary material on
remand is restricted solely to that submitted by the parties before issuance of
the Penrod Non-Final Order. Entry Regarding “Clarification of Position on Remand of Petitioner Hoosier Environmental
Council, Inc.,” paragraph 5, issued December 13, 2005.
178.
It is obvious
from the billing records provided by Mullett with the five verified and
supplemental verified statements, that Mullett, Polk & Associates maintains
highly detailed records of billable hours.
179.
However, no
billing records have been presented as evidence of hours expended in advance of
Mullett’s appearance in this proceeding.
180.
Affidavits of a
fee petitioner’s counsel are generally insufficient to establish prevailing
market rates. Gateway, supra at citing Blum v. Stenson, 465
181.
Mullett’s
affidavit with respect to the retainer is the only evidence in the record by
which it may be ascertained that a retainer of this type is customary within
the area’s legal profession and that evidentiary material is simply
insufficient to support an award of $5,000.00 to HEC.
182.
Fees properly
awarded pursuant to 312 IAC 3-1-13(a) are only those “costs and expenses
reasonably incurred.”
183.
It is the case
that fee shifting statutes are intended to promote citizen participation, which
in many instances may require the expertise of an attorney. Save
Our Cumberland Mountains, supra.
184.
However it is
also necessary to avoid an award of fees that amounts to a “windfall” for the
attorney. Farrar v. Hobby, 506
185.
An award of
attorneys fees based upon a “lodestar” calculation is presumptively
adequate. Save Our Cumberland Mountains and Utah International,
supra.
186.
“The
determination of an appropriate award begins with the calculation of a
“’lodestar’ – the number of hours reasonably expended multiplied by a
reasonable hourly rate.” Save Our Cumberland Mountains, supra
at 1532 and Utah International, supra.
187.
By its very
definition, the “lodestar” does not contemplate the award of fees in the form
of retainers because there are no hours
set forth to which a reasonable hourly rate may be applied.
[VOLUME 10, PAGE 354]
188.
Awarding
attorneys fees associated with a retainer is not only contraindicated by the
“lodestar” concept but would open the door for potential abuse in such a manner
as to produce windfalls for attorneys.
189.
Furthermore,
awarding fees in the form of a retainer circumvents the fee petitioner’s burden
to provide a detailed record of billable hours that facilitates the opposing
parties’ appraisal of the fee request. Save Our Cumberland Mountains, supra
at 1532.
190.
Mullett, Polk and
Associates began representation of HEC while the Fee Petition Phase was
underway following the withdrawal of Max Goodwin, HEC’s previous attorney of
record. It is reasonable that Mullett
was required to conduct file review, client consultation, research and other
professional tasks before commencing representation of HEC.
191.
It is not
believed that Mullett set out to abuse the fee shifting provisions of 312 IAC
3-1-13(a) by seeking fees associated with the retainer.
192.
Extensive review
of applicable caselaw is void of any reference to an award of fees associated
with a retainer. Gateway Coal Co., Natural Resources Defense Council, Inc.,
Sierra Club,
193.
HEC cites Save Our Cumberland Mountains as
support for a fee award associated with its retainer. In fact, the Save Our
194.
Despite HEC’s
numerous filings in support of an award of fees associated with the retainer,
it has produced no case specifically discussing the concept of awarding fees
for a retainer.
195.
Had Mullett,
instead of seeking a fee award for pre-appearance activities by means of a
retainer, presented billing records as evidence of hours associated with those
pre-appearance activities, fees for those hours multiplied by the reasonable
hourly rate arguably could have been awarded utilizing the “lodestar” formula.
196.
The Department
maintains that Mullett’s $5,000.00 retainer amounts to a violation of Rule
1.16(d) of the Indiana Rules of Professional Conduct. That is not decided here and is not a factor
in this analysis.
[VOLUME 10, PAGE 355]
197.
It is determined
that HEC simply failed to present evidence relating to Mullett’s pre-appearance
work hours in a manner that comports to the requirements of Save Our Cumberland Mountains.
198.
HEC’s invitation
to expand the lodestar concept to allow recovery of a retainer is
declined.
199.
Finding no means
available to apply the “lodestar” formula to the $5,000.00 retainer sought by
HEC it is determined that HEC has failed to
bear its burden of proof with respect to the $5,000.00 retainer and an
award of fees relating to that amount must be denied.
200.
HEC’s request for
fees relating to Mullett, Polk and Associates’ representation during the Fee
Proceeding Phase is reduced to $24,825.56.
201.
Expenses associated
with Mullett, Polk & Associates’ representation of HEC in the Fee
Proceeding Phase equal $375.31.
202.
The remainder,
$24,450.25 is attributed to 48.5 hours at $180.00 per hour for Mullett, 142
hours at $100.00 per hour for Lyle (paralegal), 11.75 hours at 22.50 per hour
for legal interns, 1.5 hours at $21.00 per hour for legal interns, 6 hours at
$37.50 for graduate law clerks, 19.5 hours at $35.00 per hour for law clerks
and 9.75 hours at $32.50 for office administration.
203.
HEC initially
sought fees for the services of Fry for 246 hours at $16.67 for a total of
$4,100.82 and expenses of $347.25. Tender of Affidavits in Support of Fee
Petition. However, HEC modified that
request on June 24, 2002 to reduce the expenses to $298.50 and increase the hours
to 254.75, for a total of $4,246.68. Verified Statement of Tim Maloney Re: HEC
Payments for Employee Time and Expense.
204.
HEC initially
sought fees relating to the services of Stant including 590 hours at $20.00 per
hour for a total of $11,800.00 and $1027.40 in expenses. On June 24, 2002 the hours attributed to
Stant’s work were confirmed but the expenses were reduced to $672.90.
205.
Sought fees
associated with the services of Waldo were initially sought at 60 hours and
included $335.00 in expenses. On June
24, 2002, Waldo’s hours were increased to 73.65 hours at $13.00 per hour, or $957.45,
and his expenses reduced to $35.00.
[VOLUME 10, PAGE 356]
Total of Sought Fees for
Unpaid Experts:
206.
Hendrik Haitjema (Haitjema), Joseph Hailer (Hailer), Russell Boulding (Boulding) and Anne Spacie (Spacie), each tendered affidavits in
support of an award of fees to HEC as follows.
Haitjema $2,850.00
Hailer $2,152.24
Boulding $4,065.60
Spacie $ 287.60
Tender of Affidavits in Support of Fee
Petition and Tender of Affidavit of Hendrik Haitjema in Support of Fee Petition.
207.
Each of these
individuals provided expert testimony during the twelve day administrative
hearing, but did so on a voluntary, unpaid, basis. Transcript
of Objections Hearing, January 23, 1997, page 27.
208.
The Department
objects to the award to HEC for fees relating to the services of Haitjema,
Hailer, Boulding or Spacie for the reason that HEC did not “incur” any costs or
expenses associated with these experts.
209.
HEC’s numerous evidentiary
filings are devoid of evidence indicating any actual expenses incurred by the
involvement of Haitjema, Hailer, Boulding or Spacie.
210.
The Department is
correct with respect to HEC’s unpaid experts in that an award would not
constitute reimbursement for expenses “reasonably incurred.”
211.
Fees associated
with Haitjema, Hailer, Boulding and Spacie are excluded from further
consideration.
Total of Sought Fees for
Paid Expert:
212.
HEC submitted the
Affidavit of Charles Norris dated May 8, 2000 (Norris Affidavit), in which Mr. Norris states that HEC compensated
him the total amount of $12, 675.25 and reimbursed expenses in the amount of
$2,429.90. Tender of Affidavits in Support of Fee Petition. However, on June 24, 2002, HEC filed
supplementation to the Norris Affidavit, which includes a billing/payment
ledger for “Foertsch Expense HEC.” Verified Statement of Tim Maloney Re: HEC
Payments for Time and Expenses of Charles Norris. Therein, Tim Maloney, increased the amount
sought for HEC’s payments to Norris for services rendered to $14,402.01,
exclusive of expenses.
213.
Careful review of
HEC’s billing/payment ledger relating to Norris reveals however that on four
occasions (4/17/96, 5/24/96, 12/30/96, 2/17/97) of payment the “full amount of
check is listed – includes payment for work on other cases in addition to
Foertsch.” HEC provides no data upon
which Norris’ compensation for the Foertsch Litigation may be separated from
other matters with respect to these four incidents.
[VOLUME 10, PAGE 357]
214.
Obviously, HEC’s
modified claim of $14,402.01 is inflated and must be ignored.
215.
However, nothing
exists upon which to question the Norris’ affidavit and as such $12,675.25 in
hourly compensation and $2,429.90 for expenses must be considered accurate.
TOTAL FEES REASONABLY AWARDED TO HEC:
216.
A determination
that a fee petitioner is both eligible for and entitled to an award does not
necessitate a determination that the total amount of fees sought are
reasonable. Natural Resources Defense Council v. Office of Surfacing Mining
Reclamation and Enforcement , 107 IBLA 339, (1989) determining that
partially successful fee petitioner was reasonably compensated for 763.75
hours, or 31%, of 2,428.61 hours claimed; Sierra Club v. Environmental
Protection Agency, 769 F.2d 796, (1985) awarding partially successful fee
petitioner with compensation for 559 hours of the requested 800 hours; Save
Our Cumberland Mountains v. Hodel, 651 F.Supp. 1528, awarding completely
successful fee petitioner with a full award of sought fees minus twenty-five
percent(25%) for the fee petitioner’s failure to exercise billing judgment with
respect to work on the appeal portion of
the case; Gateway Coal Co. v. Office of Surface Mining Reclamation and
Enforcement, 131 IBLA 212, (1994) determining that a fully successful fee
petitioner was entitled to fees for 311 hours of the total 339.5 hours claimed.
217.
It cannot be
concluded that HEC obtained excellent results substantiating an award of all of
its fees. See Hensley and Sierra Club, supra; Finding 85.
218.
Similarly, it
cannot be determined, as the Department proposes, that HEC’s success was so
dismal as to afford it only twenty-five percent (25%) credit for the
Administrative Review Phase and eight percent (8%) credit for the Fee Petition
Phase. Respondent DNR’s Proposed Findings of Fact and Conclusions of Law with
Final Order of the Natural Resources Commission.
219.
There exists no
exacting method by which the reasonableness of a fee award is to be
determined. Natural Resources Defense Council, Inc., supra.
220.
However, the
method utilized must consider the significance of the issues upon which the fee
petitioner prevails.
221.
The Interior
Board of Land Appeals expressly stated that “[a] comparison of total issues to
those prevailed upon would not give weight to the relative significance of
issues. For example, if a case presented
10 issues and the party seeking attorneys’ fees prevailed on only one of them,
a pure mathematical approach would dictate that the party was only 10 percent
successful, regardless of the relative importance of the issues.” Id
at 386.
[VOLUME 10, PAGE 358]
222.
Methods utilized and
accepted by the Interior Board of Land Appeals have included a “page-counting
method” by which the total number of pages devoted to issues upon which a fee
petitioner enjoyed success is identified in significant pleadings and divided
by the overall total number of pages within those same pleadings in order to
establish a percentage.
223.
The Interior
Board of Land Appeals, while accepting the “page-counting method” as a useful
aid in the particular case being considered, recognized the “deficiencies
inherent in such a method” and stated that it “expressly declines to adopt the page-counting
method for all cases.” Id at 386.
224.
An award of fees
associated with I-SMCRA must be “reasonably incurred.” 312 IAC
3-1-13(a).
225.
The fee
petitioner bears the burden of documenting time and expenses sufficiently to
allow for appraisal by the court and opposing counsel. Save Our Cumberland Mountains,
supra at 1532.
226.
The fee
petitioner is also responsible for the subtraction of unproductive or excessive
time and expenses. Id citing Copeland
v. Marshall, 641 F.2d 880, 891, (D.C. Cir. 1980).
227.
The commonly
favored method of computing reasonable fees is to commence with an examination
of the lodestar, or the number of hours reasonably expended multiplied by a
reasonable hourly rate. Utah International, at 828, citing Hensley
v. Eckerhart, 461 U.S. 424, 433.
228.
Consistent with
the theory of degree of success based fees is the determination that where fee
petitioners enjoy only limited success in obtaining the full award of fees
sought, a fee petitioner’s award for the prosecution of a fee petition should
be restricted to the percentage of the fee actually awarded for the underlying
litigation.
229.
As previously
determined, the award of fees for HEC’s participation in the Commission
Objections Phase or the Judicial Review Phase of the Foertsch Litigation is not
reasonable.
230.
The Commission
Objections Phase commenced on October 11, 1996 followed immediately by the
Judicial Review Phase that terminated on September 13, 1999.
[VOLUME 10, PAGE 359]
231.
Consequently, HEC
is not entitled to an award for fees incurred between October 11, 1996 and
September 13, 1999.
232.
It is relatively
simple to separate fees claimed for the Administrative Review Phase from those
claimed for other phases of the Foertsch Litigation. However, HEC’s Petition for Fees was filed on
March 27, 1997, during the pendency of the Judicial Review Phase and was
contested actively until placed in abeyance on December 2, 1997.
233.
HEC bears the
burden of identifying the sought fees associated with each phase of the
Foertsch Litigation and Fee Petition Phase.
Utah International, footnote
at 831, citing Ramos v. Lamm, 713 F.2d 546, 553, (10th Cir.
1983). Where this has not been done
and hours cannot reasonably be attributed to phases for which HEC is entitled
to fees, those hours must be disallowed.
234.
For those fees
and expenses incurred during the overlapping period associated with the Fee
Petition Phase and the Judicial Review Phase, the administrative law judge has,
consistent with Utah International,
endeavored to estimate fees and expenses associated with each respective phase. At 831.
235.
Goodwin’s billing
records and affidavit allow for relative ease in separating those fees
associated with hours worked between October 11, 1996 and September 13,
1999. Tender of Affidavits in Support of Fee Petition and Verified Statement
of Chris A. Wrede. According to the
billing records, Goodwin expended 98.5 hours on the Foertsch Litigation between
October 24, 1996 and June 2, 1998, which includes 2.75 hours in 1998. Verified
Statement of Chris A. Wrede.
Additionally, Goodwin’s affidavit states that he expended a minimum of
ten (10) hours in 1998 and a minimum of twenty (20) hours in 1999. Tender
of Affidavits in Support of Fee Petition.
236.
A portion of
Goodwin’s hours during this period relate to HEC’s Petition for Fees, which was
filed on March 24, 1997. A review of
Goodwin’s billing records for hours between October 11, 1996 and September 13,
1999 relating to the fee petition have been identified as a total of two (2)
hours occurring on March 19, 1997 and September 12, 1997. Verified
Statement of Chris A. Wrede.
237.
Therefore,
Goodwin will be credited with two hours in 1997 and twenty (20) hours in 2000
at $150.00 per hour, or $3300.00 for work relating to the Fee Petition Phase.
238.
Goodwin does not
provide any specificity regarding the twenty hours of work in 1999. Despite the possibility that some of those
hours may relate to the Fee Petition Phase, the hours cannot be reasonably
separated and must, therefore, be excluded.
[VOLUME 10, PAGE 360]
239.
Of Goodwin’s
total hours expended, or 458 hours, it is determined that 123.75 of those hours
related to the Commission Objection and Judicial Review Phase. As a result HEC is not entitled to an award
of fees for 123.75 hours expended by Goodwin.
240.
The remaining 312.25
hours amounting to $46837.50, is applicable to the Administrative Review Phase.
241.
Goodwin also
provided an expense report, which reveals that between August 25, 1995 and July
25, 1996, during the Administrative Review Phase, he incurred expenses of $1,027.31.
Verified Statement of Chris A.
Wrede.
242.
Goodwin’s expense report indicates that
expenses incurred relating to HEC’s Petition for Fees were incurred on March
21, 1997, August 19, 1997, September 12, 1997, April 6, 2000, May 23, 2000 and
June 13, 2000 totaling $364.63.
243.
The remainder of
expenses reflected on Goodwin’s expense report for the period between October
11, 1996 and September 13, 1999 are either clearly related to the Commission
Objections Phase or the Judicial Review Phase or simply cannot be ascertained.
244.
Consequently,
expenses incurred by Goodwin, except those specifically identified above, are
disallowed.
245.
HEC provided time
sheets for its employees, Fry, Stant and Waldo, from which time expended with
respect to the Commission Objections Phase and Judicial Review Phase can be
reasonably ascertained. Verified Statement of Tim Maloney Re: HEC
Payments for Employee Time and Expenses.
246.
The totality of
Fry’s time was expended between June 4, 1998 and April 28, 2000.
247.
Because the
Administrative Review Phase concluded with the issuance of the Teeguarden
Non-Final Order on October 10, 1996, it is clearly ascertainable that none of
Fry’s time or claimed expenses relate to the Administrative Review Phase.
248.
It is not easily
ascertainable from Fry’s time sheet to what extent his hours reasonably relate
to the Fee Petition Phase, however, the Fee Petition Phase was placed in
abeyance from December 2, 1997 until January 3, 2000. NRC
Hearings Docket. Therefore, absent
clearer records regarding the purpose of the hours expended between June 4,
1998 and September 13, 1999 on “file review,” “responses to Foertsch motions,” “motions
to stay,” “briefs” and “hearings in
[VOLUME 10, PAGE 361]
249.
The time sheet
expressly states that hours expended by Fry on August 26, 1999 did relate to
HEC’s fee petition. It can therefore be
assumed, since judicial review had concluded and the only matter remaining was the
Fee Petition Phase that all hours expended by Fry after August 26, 1999 also
related to HEC’s fee petition. Fry’s
billable hours cease on April 28, 2000, before the appearance of Mullett, Polk
& Associates.
250.
Consequently,
51.75 of Fry’s claimed hours at a rate of $16.67 per hour, or $862.67 will be included
for the Fee Petition Phase.
251.
Similarly, Fry’s
expenses relating to dates prior to August 26, 1999 must relate to the Judicial
Review Phase and are thus disallowed.
252.
Fry’s expenses
reasonably related to the Fee Petition Phase include $118.00 for mileage.
253.
Time sheets
provided for Waldo, reveal that all hours, with the exception of six (6) hours
on July 2, 1998, relate to the time between March 14, 1996 and August 30, 1996,
thus indicating they relate solely to the Administrative Review Phase. The Administrative Review Phase was concluded
before July 2, 1998 and while the Fee Petition Phase was in abeyance, thus six
(6) hours, or $78.00, must be reduced from HEC’s claimed fees for Waldo’s
services.
254.
Expenses claimed
for Waldo also relate to activities occurring on July 2, 1998 and thus must be
disallowed.
255.
Stant’s time
sheet reveals that of the 590 total hours, 527 hours related to the time
extending up to October 10, 1996, the end of the Administrative Review
Phase.
256.
Sixty one and one
half (61.5) of Stant’s remaining claimed hours were expended between October
26, 1999 and June 4, 1999 during the overlap of the Judicial Review Phase and
the Fee Proceeding Phase.
257.
Stant’s time
sheets provide insufficiently detailed information by which to ascertain how
many, if any of those 61.5 hours relates to the Fee Proceeding Phase, and must
be disallowed.
258.
Stant’s remaining
1.5 hours were expended on December 27, 1999 and April 21, 1999 following the
conclusion of the Judicial Review Phase and may reasonably be inferred to
relate to the Fee Proceeding Phase.
Those hours were also billed before the appearance of Mullett, Polk
& Associates in March 2001.
[VOLUME 10, PAGE 362]
259.
Consequently,
61.5 hours, or $1230.00 is disallowed.
Of the allowed hours, 527 are attributed to the Administrative Review
Phase and 1.5 hours are attributed to the Fee Proceeding Phase.
260.
Stant’s expenses
are all incurred during the Administrative Review Phase and are therefore not
subject to reduction.
261.
With respect to
fees sought relating to Charles Norris, it is clear that all fees paid by HEC,
that have been allowed for consideration (see
discussion supra), were incurred by HEC before the Teeguarden Non-Final
Order was issued on October 10, 1996 and as such all fees and expenses are related
to the Administrative Review Phase.
262.
Here, HEC
initially sought fees totaling $144,683.42[8]
for its involvement in the Administrative Review Phase, the Commission
Objection Phase and the Judicial Review Phase of the Foertsch Litigation. See
Exhibit A, attached, for breakdown of fees.
263.
Pursuant to the
previous discussion, HEC will be awarded $75,061.95 for the Administrative
Review Phase of the Foertsch Litigation.
264.
The actual award
to HEC represents fifty one percent (51%) of its original claim for fees for
its initiation of and participation in the Foertsch Litigation.[9]
265.
While HEC has
never, and does not now, waiver in its contention that the total amount of fees
incurred throughout all phases of the Foertsch Litigation and the Fee
Proceeding Phase should be awarded, it did through a word-counting method
(counting the words contained within the Teeguarden Non-Final Order applicable
to issues upon which it achieved success divided by the total number of words
contained within the Teeguarden Non-Final Order) ascertain that if SALJ Penrod
determined that it was entitled to “recovery of the percentage of Mr. Goodwin’s
costs and expenses related only to issues upon which HEC substantially
prevailed, HEC would be entitled to recover $49,175.99” of Goodwin’s total
sought fee of $105,754.82. Brief in Support of Proposed Findings of
Fact, Conclusions of Law and Order of Claimant Hoosier Environmental Council,
filed November 5, 2001.
[VOLUME 10, PAGE 363]
266.
In Natural Resources Defense Council, Inc.,
the page-counting method, similar to the word-counting method undertaken by
HEC, was applied to the entirety of the substantive issues and would be equally
applicable to not only Goodwin’s fee but to all phases of the Foertsch
Litigation.
267.
An award of
$49,175.99 of $105,754.82 amounts to only a forty-six percent (46%) recovery
rate.
268.
However, the
Teeguarden Non-Final Order clearly indicated that evidence discussed with
respect to issues upon which HEC failed to succeed was also important to a
determination of those issues upon which HEC did succeed. With that in mind, arguably, on one hand, HEC’s
word-counting method utilizing the Teeguarden Non-Final Order gives HEC insufficient
credit. However, on the other hand the
word-counting method involving the Teeguarden Non-Final Order may provide to
HEC too much credit in that this method fails to consider the reduction in
HEC’s success following the Commission Objection Phase during which the amount
of CCW authorized for disposal was increased over HEC’s objections.
269.
While the means
undertaken herein to calculate the reasonable fees to which HEC is entitled are
entirely different than the method undertaken by HEC it is apparent that a
fifty-one percent (51%)[10]
fee recovery is consistent with HEC’s own success based calculations.
270.
It is
insignificant that in calculating the reasonable fee to which HEC is entitled, HEC
was awarded the totality of fees sought for one phase and no fees for the
remaining two phases of the Foertsch Litigation, so long as the outcome, or the
actual fee awarded, accommodates HEC in a manner consistent with its
accomplishments.
271.
It is believed
that the method utilized herein more accurately reflects the true degree of
HEC’s success.
272.
This result
improves by five percent (5%)[11]
HEC’s own calculations for determining a partial fee recovery using the
word-counting method.
273.
Pursuant to Utah International, HEC’s award
for fees relating to the Fee Petition Phase must be reduced by forty-nine
percent (49%)[12].
[VOLUME 10, PAGE 364]
274.
The total amount
claimed by HEC, and not disallowed, for the Fee Petition Phase is $29,500.86.
275.
HEC’s award for its prosecution of the Fee Petition
Phase is $15,045.44.
276.
The following
table represents the total award of fees reasonably awarded to HEC[13].
|
|
Administrative Review Phase
|
Fee Proceeding Phase
|
|||
|
|
Hour Based Fees
|
Expenses |
Hour Based Fees |
Expenses |
|
|
Fry |
------------------ |
------------------- |
$ 862.67 |
$118.00 |
|
|
Stant |
$10,540.00 |
$ 672.90 |
$ 30.00 |
---------------- |
|
|
Waldo |
$ 879.45 |
------------------- |
------------------- |
---------------- |
|
|
Norris |
$12,675.00 |
$ 2,429.90 |
------------------- |
---------------- |
|
|
Goodwin |
$46,837.50 |
$ 1,027.31 |
$ 3,300.00 |
$364.63 |
|
|
Mullett |
-------------------- |
------------------- |
$24,450.25 |
$375.31 |
|
SUB-TOTAL
|
$70,931.95 |
$4130.11 |
$28,642.92 |
$857.94 |
|
TOTAL
|
$75,061.95 |
$15,045.44 ($29,500.86 reduced by 49%) |
|||
|
GRANT TOTAL |
$90,107.39 |
||||
ADJUSTMENTS TO THE LODESTAR:
277.
The
reasonableness of fees sought must be determined from the basis of a “strong
presumption that the lodestar represents the reasonable fee to which counsel is
entitled.” Utah International, supra, citing Blum v. Stenson, 465
U.S. 886, 897, (1984).
278.
From that base,
adjustments, either upward or downward, may be made based upon the specific
evidence. Id citing Pennsylvania v. Delaware Valley Citizens’ Council,
478
279.
Various factors,
including the achievement of exceptional results, the novelty or difficulty of
the issues involved, the degree of skill required by counsel, the contingent
nature of a fee award, as well as the delay in payment of the award, have been
argued as a basis for upward adjustments to the lodestar. Utah
International, supra, Save Our Cumberland Mountains, Inc., supra.
280.
Hensley has
been cited as “explicit” authority in support of an upward adjustment of the
lodestar for exceptional success on the merits. Save Our Cumberland Mountains, Inc. supra at 1542.
281.
Put simply, if Hensley provides authority for an
upward adjustment of the lodestar based upon “exceptional success” in F-SMCRA
proceedings, and F-SMCRA decisions rely upon Hensley for that upward adjustment, logic dictates that Hensley also provides authority
for a downward adjustment of the lodestar for limited success.
282.
An upward or
downward adjustment to the lodestar may only be granted if the party seeking
such adjustment provides justification through specific evidence. Utah
International, supra at 828, citing Pennsylvania v. Deleware, supra.
[VOLUME 10, PAGE 365]
283.
The lodestar
relating to the Administrative Review Phase of the Foertsch Litigation, and the
amount strongly presumed to be reasonable for an award to HEC, is $75,061.95.
284.
As might be
expected HEC contends that certain fees should be increased from the lodestar,
while the Department seeks a reduction from the lodestar.
HEC’s Request for Upward
Adjustment to Lodestar:
285.
HEC has,
throughout its briefings in the Fee Petition Phase, sought an award of fees for
Goodwin at his increased rate of $225.00 per hour.
286.
In the
Department’s mind this would be tantamount to the application of a 50%
multiplier applied to the “rate level” reflected in Goodwin’s billing
records. Verified Statement of Chris A. Wrede. While the determination has
been previously made to allow certain portions of Goodwin’s fee associated with
the Administrative Review Phase and the Fee Petition Phase at $150.00, it is
important to discuss the inapplicability of HEC’s sought 50% multiplier with
respect to Goodwin’s fee.
287.
HEC’s support of awarding
Goodwin’s fee at the higher $225.00 per hour rate is partially speculative. HEC states, “in all likelihood, the $225.00 per hour rate is less than the
market rate of recovery Mr. Goodwin is entitled” under Save Our Cumberland Mountains, which supports the premise
that in certain situations attorneys fees should be awarded based upon market
rate. Goodwin, himself states that he is
only “reasonably certain” his $225.00
rate is less than the fee charged by similarly skilled attorneys in similar
types of litigation. Brief in Support of Proposed Findings of
Fact, Conclusions of Law and Order of Claimant, Hoosier Environmental Council, filed November 5, 2001 (emphasis added),
Tender of Affidavits in Support of Fee Petition.
288.
HEC’s reliance
upon Save Our Cumberland Mountains
is misplaced here.
289.
Involved in Save Our Cumberland Mountains was
the proper hourly rate applicable to an attorney whose primary practice
involved public interest litigation for which rates were reduced but which
attorney also maintains some private practice clients who are billed at market
rates. Under that scenario, it was
concluded that the attorneys should be compensated at customary market rates as
opposed to the reduced public interest billing rate.
290.
What HEC fails to
address is the holding by Save Our
Cumberland Mountains that “if an attorney is involved in private
practice the hourly rate charged for his or her services is presumptively a
reasonable rate.” The court further
determined that even with respect to “private public-interest attorneys,” as
they were characterized by the court, that “in almost every case, a firm’s
established billing rate is the ‘reasonable’ rate.” At 1537
and 1540. See also Laffey v. Northwest Airlines, Inc., 572 F.2d.4, 16-17.
[VOLUME 10, PAGE 366]
291.
There is no
evidence in the record of this proceeding that Goodwin’s practice involved
primarily litigation of public interest matters for which he charged decreased
hourly rates.
292.
Nothing contained
in the record reveals that the “rate level” of $150.00 indicated in Goodwin’s own
billing records was anything other than his customary market rate, which
excluded paralegal services.
293.
This is
especially true since there is no evidence to support even an inference that
Goodwin’s firm dedicated paralegal support to the Foertsch Litigation or the
Fee Petition Phase. Instead, what is
clearly evidenced in the record is that HEC employees served in that role.[14]
294.
The other
justification for application of Goodwin’s $225.00 per hour rate is to
accommodate for the “lack of compensation until the conclusion of the case.” Brief in Support of Proposed Findings of
Fact, Conclusions of Law and Order of Claimant, Hoosier Environmental
Council, filed November 5, 2001
(emphasis added), Tender of Affidavits in Support of Fee Petition.
295.
Goodwin’s
affidavit is clear and undisputed that his customary rate is $150.00, exclusive
of paralegal fees, and $225.00, inclusive of paralegals and for extra
compensation for delayed payment.
296.
Accommodating for
delay in compensation through an upward adjustment of the lodestar was rejected
in Utah International, supra at 830. In its determination, the court likened an
upward adjustment of an attorney fee as an adjustment for delayed compensation
to an award of interest, which had been previously denied. See Library
of Congress v. Shaw, 478
297.
HEC does not provide any evidence sufficient
to overcome the presumption that Goodwin’s “rate level” of $150.00 is reasonable.
298.
Thus, HEC’s
request for a 50% upward adjustment for the services rendered by Goodwin is
denied.
[VOLUME 10, PAGE 367]
Department’s Request for
Downward Adjustment to Lodestar:
299.
The Department,
in support of its position that the lodestar should be reduced cites primarily
HEC’s limited success in obtaining the addition of conditions to S-312-1 in
combination with the Department’s own limited success in defending the issuance
of S-312-1.
300.
This presents an
interesting question that has not exactly presented itself in any F-SMCRA decision
previously cited[15] except
in the context of an award for prosecution of a petition for fees.[16]
301.
However, the
concept of a downward adjustment has been discussed in Hensley, supra, which has been cited as support in F-SMCRA
proceedings for an upward adjustment and thus will be used to analyze the
Department’s downward adjustment request.
302.
Hensley
recognizes that a critical factor in evaluating a fee awards’ reasonableness is
“the degree of success obtained.” at 436.
303.
However, unlike
proceedings involving strictly money damages, consideration must be given to
the effect of the litigation on policy changes when the matter at issue
involves public policy and governmental regulation. See Babbitt, at 821.
304.
In the Administrative
Review Phase of the Foertsch Litigation it is conceded by HEC that they did not
achieve 100% success. In addition to
HEC’s failure to obtain the revocation of S-312-1, HEC also failed to prevail
on its claims that the Department’s approval was based upon insufficient site
characterization data, that the number, location and depth of monitoring wells
was insufficient, that the CCW was insufficiently isolated from contact with
ground and surface water (with the exception of the gains regarding the
restriction on amount of CCW disposed), or that the Department should impose an
enforceable water quality standard to protect against water quality
degradation.
305.
However, HEC did
succeed on two procedural matters that were integral to the Foertsch Litigation
reaching a decision on the merits. Those
procedural triumphs lead to the imposition of four additional substantive
conditions to S-312-1. Specifically, HEC
succeeded in obligating the coal company to provide notification to future real
estate purchasers of the existence of CCW waste, in requiring six months of
accurate and useable water quality to be collected in advance of any disposal
of CCW, delaying any possibility of full bond release until long term
monitoring of the site was possible and gaining restrictions on the disposed
CCW to 50% of the tonnage of coal removed.[17]
[VOLUME 10, PAGE 368]
306.
Even the
Commission recognized that the issue of CCW disposal had been a topic of great
concern and debate for “many years.” Transcript of the Objections Hearing,
January 23, 1997.
307.
While three of
HEC’s achievements pertained solely to S-312-1, the CCW disposal restriction
has, without dispute, materially altered the Department’s evaluation of all
applications for CCW disposal permits since the Foertsch Litigation concluded.
308.
The CCW disposal restriction
can only be characterized as a major success by HEC in the Foertsch Litigation.
309.
While HEC did not
obtain revocation of S-312-1 or all of the conditions relating to the disposal
of CCW that it set out to obtain, the successes it did achieve were legally
significant and materially altered certain policies of the Department.
310.
It is
inappropriate to award fees for time spent on claims that were unsuccessful to
the extent they can be separated from successful claims.
311.
However, the issues
presented by HEC in the Foertsch Litigation, largely, if not exclusively,
related to ground water and surface water protection. The Department has not, through specific
evidence, identified any issue undertaken by HEC in the Foertsch Litigation for
which the evidence, legal briefing or other activity related solely to HEC’s
unsuccessful claims such that expenses relating to the unsuccessful claims may
be separated from the expenses relating to claims upon which it achieved
success.
312.
The Department
has failed to sustain its burden in overcoming the presumption of
reasonableness of the lodestar with respect to the Administrative Review Phase.
313.
The Department’s
sought downward adjustment of the lodestar is similarly denied.
[VOLUME 10, PAGE 369]
APPENDIX A[18]
Total Fees Sought By HEC For Foertsch Litigation:[19]
Goodwin
436 hours at $225.00 $98,100.00
Expenses $ 2,692.96
Fry
203 hours at $16.67 $ 3,384.01
Expenses $ 229.25
Waldo
73.65 hours at $13.00 $ 957.45
Expenses $ 335.00
Stant
588.5 hours at $20.00 $11,770.00
Expenses $ 1,027.40
Haitjema
Total Claim $
2,850.00
Hailer
Total Claim $
2,152.24
Boulding
Total Claim $
4,065.60
Spacie
Total Claim $ 287.60
Norris
Total Claim $16,831.91
HEC’S TOTAL “FOERTSCH LITIGATION” CLAIM $144,683.42
[VOLUME 10, PAGE 370]
APPENDIX B
Total Fees By Phase Sought By HEC:[20]
|
|
Administrative Review Phase
|
Fee Proceeding Phase
|
||
|
|
Hour Based Fees
|
Expenses |
Hour Based Fees |
Expenses |
|
Fry |
------------------ |
------------------- |
$ 862.67 |
$118.00 |
|
Stant |
$10,540.00 |
$ 672.90 |
$ 30.00 |
---------------- |
|
Waldo |
$ 879.45 |
------------------- |
------------------- |
---------------- |
|
Norris |
$12,675.25 |
$ 2,429.90 |
------------------- |
---------------- |
|
Goodwin |
$70,256.25 |
$ 1,027.31 |
$ 4,950.00 |
$364.63 |
|
Mullett |
-------------------- |
------------------- |
$24,450.25 |
$375.31 |
SUB-TOTAL
|
$94,350.95 |
$4130.11 |
$30,292.92 |
$857.94 |
TOTAL
|
$98,481.06 |
$31,150.86 |
||
|
|
COMMISSION OBJECTION PHASE |
JUDICIAL REVIEW PHASE |
||
|
|
Hour Based Fees |
Expenses |
Hour Based Fees |
Expenses |
|
Fry |
--------------------- |
----------------- |
$ 3,384.01 |
$ 180.50 |
|
Stant |
--------------------- |
----------------- |
$ 1,230.00 |
----------------- |
|
Waldo |
--------------------- |
----------------- |
$ 78.00 |
$ 35.00 |
|
Norris |
--------------------- |
----------------- |
--------------------- |
----------------- |
|
Goodwin |
$15,918.75 |
$ 568.21 |
$ 5,175.00 |
$ 1,097.44 |
|
Mullett |
--------------------- |
----------------- |
--------------------- |
----------------- |
|
SUB-TOTAL |
$15,918.75 |
$ 568.21 |
$ 9,867.01 |
$ 1,312.94 |
|
TOTAL |
$16,486.96 |
$11,179.95 |
||
|
|
Hour Based Fees |
Expenses |
|
Fry |
|
$ 48.75* |
|
Stant |
|
$ 354.50* |
|
Waldo |
|
$ 300.00* |
|
Goodwin |
$ 6,750.00 |
|
|
Mullett |
$ 5,000.00 |
|
|
Haitjema |
$ 2,850.00* |
|
|
Hailer |
$ 1,820.00* |
$ 332.24* |
|
Boulding |
$ 3,975.00* |
$ 90.60* |
|
Spacie |
$ 200.00* |
$ 87.60* |
|
Norris |
$ 1,726.76 |
|
|
SUB-TOTAL |
$22,321.76 |
$ 1,213.69 |
|
TOTAL |
$23,535.45 |
|
[1] Previously 310 IAC 0.6-1-13
[2] For purposes of a full discussion of the fee shifting provisions under F-SMCRA and I-SMCRA, certain references are made to the issue of a fee petitioner’s eligibility to receive an award of fees. It is understood however, that HEC’s eligibility for an award of fees is not at issue herein.
[3] It was
determined that in “non-enforcement, non-adversarial” processes authorized by
F-SMCRA, such as the process of seeking an unsuitability designation, the
government is not a “party” and thus the environmental organizations’ were not
eligible for a fee award for that phase of the process.
[4] The Administrative Review Phase, Commission Objection Phase and Judicial Review Phase are collectively referred to as the Foertsch Litigation.
[5] Before commencement of the Foertsch Administrative Review, the Commission had determined in an unrelated proceeding that a lay person was entitled to represent a different person in a proceeding before it. This issue was, during the pendency of the Foertsch Administrative Review, a matter under judicial review and Foertsch sought to preserve the issue pending the outcome of that judicial review because, HEC’s director, who was not an attorney, had executed and filed the petition for administrative review on behalf of HEC.
[6] In Sierra, the court recognized that
its citation from
[7] Fee shifting provisions of 307(f) of the Clean Air Act have routinely been evaluated on the same basis as the fee shifting provisions contained with fSMCRA.
[8] This amount represents all hours, including disallowed hours, charged at the highest rate argued applicable by HEC in the Fee Petition Phase.
[9] If the percentage of HEC’s fee recovery were calculated utilizing HEC’s amended fee claims the total amount awarded, $75,061.95, would be divided by the amended total amount sought, $134,624.73, to yield a 56% recovery. See finding276 and footnote 11.
[10] Fifty-six percent (56%) if calculated utilizing HEC’s amended fee claims. See footnote 9, finding 267 and footnote 11.
[11] Ten
percent (10%) if calculated utilizing HEC’s amended fee claims. See
footnote 9, finding267 and footnote 11.
[12] HEC’s initial submissions in support of its fee petition were made between May and June of 2000, claiming fees for certain unpaid voluntary experts, HEC employees, one paid expert and Goodwin. Over two (2) years later, HEC submitted amended affidavits modifying the fees associated with HEC employees and its one paid expert as well as withdrawing its fee request associated with the unpaid voluntary experts. During the intervening two (2) years HEC and the Department through numerous briefs debated the appropriateness of awarding fees for unpaid voluntary experts. The amendment of the submissions associated with fees for HEC employees, of necessity resulted in additional attorneys fees that would not have been required but for the errors contained within HEC’s initial submissions. Compare Tender of Affidavits in Support of Fee Petition, filed May 23, 2000; Tender of Affidavit of Hendrik Haitjema in Support of Fee Petition, filed June 13, 2000; Verified Statement of Chris A. Wrede, filed June 13, 2002; Verified Statement of Tim Maloney Re: HEC Payments for Employee Time and Expenses, filed June 24, 2002; Verified Statement of Tim Maloney Re: HEC Payments for Time and Expenses of Charles Norris, filed June 24, 2002; Verified Statement of Tim Maloney Re: HEC Payments for Vendor Expenses, filed June 24, 2002, Verified Statement of Michael A. Mullett, filed November 5, 2001; Verified Statement of June M. Lyle, filed November 5, 2001; Supplemental Verified Statement of Michael A. Mullett, filed November 15, 2001; Supplemental Verified Statement of June M. Lyle, filed November 15, 2001; Second Supplemental Verified Statement of Michael A. Mullett, filed June 13, 2002.
HEC did not exercise billing judgment by subtracting time for the litigation expenses associated with the debate regarding the unpaid experts or for the duplicitous attorney fees associated with the erroneous claims as required by Save Our Cumberland Mountains, supra.
The submissions presented by HEC associated with the Fee
Proceeding Phase are insufficient to allow the administrative law judge to
clearly ascertain and deduct the number of hours spent by attorneys and
paraprofessionals on the endeavors associated with these erroneous or
ultimately withdrawn claims. To address
a similar situation the United States District Court for the
Based upon HEC’s initial claims for the Foertsch Litigation (the Administrative Review Phase, the Commission Objection Phase and the Judicial Review Phase) the total amount sought is $144,624.42. HEC’s amended submissions, which withdrew claims associated with the unpaid experts and decreased the amounts claimed for HEC employees (See Appendix B), would total $134,624.73. HEC’s award for the Foertsch Litigation based upon the amended submissions, ($75,061.95 divided by $134,624.73) equals 56% of the total fees sought, while a calculation of HEC’s fee award based upon the initial submission ($75,061.95 divided by $144,624.42) results in 51% of the total sought fees.
HEC’s award of fees associated with the Fee Petition Phase is appropriately proportioned with the percentage of fees awarded for the underlying litigation. Awarding fees for the Fee Petition Phase based upon 51%, instead of 56%, in application imposes a five percent (5%) reduction in the award to address HEC’s failure to exercise billing judgment. Application of this method results in a reduction of the award by only $1,475.04.
[13] The table presented here is identical to the corresponding table contained within Appendix B, with the exception that here, fees associated with Goodwin’s representation of HEC is calculated using his $150.00 per hour rate.
[14] There is no question that Goodwin intended for any fee award obtained through this proceeding to be his full compensation. Verified Statement of Chris A. Wrede. It is reasonable to infer from the evidence presented that Goodwin’s use of HEC staff for paralegal services was an effort to protect himself and his firm from increasing losses that might result from the dedication of firm paralegal staff to the Foertsch Litigation.
[15] Utah International and Save Our Cumberland Mountains the fee petitioners were deemed to have achieved complete success in the phase for which they were awarded a fee.
[16] Utah International explicitly authorizes a downward adjustment of fees compensable on a fee proceeding where only a fraction of the originally sought fee relating to the underlying litigation is actually awarded.
[17] This restriction following the Administrative Review Phase was 75% of the tonnage of coal removed but was modified to 50% during the Commission Objection Phase.
[18] The fee calculations used in this section identify the total of all fees claimed by HEC calculated at the highest rate sought. Certain fees, as indicated “*” (categorized as “disallowed) are actually fees that were reduced or withdrawn by HEC through amended pleadings filed over two years after the initial fees were claimed.
[19] “Foertsch Litigation” refers collectively to the Administrative Review Phase, Commission Objection Phase and Judicial Review Phase.
[20] The fee calculations used in this section identify the total of all fees claimed by HEC calculated at the highest rate sought. Certain fees, as indicated “*” (categorized as “disallowed”) are actually fees that were reduced or withdrawn by HEC through amended pleadings filed over two years after the initial fees were claimed.