Sixth Circuit reviews whistleblower attorney's fee award in GE case

by Ben Vernia | September 15th, 2010

On September 3, the Sixth Circuit Court of Appeals issued an unpublished decision on relator’s attorney’s fees, in U.S. ex rel. Lefan v. General Elec. Co., in a companion decision to one addressing the splitting of a contingency fee among whistleblower firms. As described in that post, the relators employed three firms to handle their case, which alleged that GE provided defective jet engine components to the military. Two of the firms settled the attorney’s fee issue with GE, but the company and Cincinnati’s Helmer, Martins and Morgan appealed various issues from the district court’s overall award of $2.4 million in fees.

The Sixth Circuit largely upheld the court’s award, holding:

  • That the law firm’s appeal was timely, even though it filed notice after the 30-day period provided by Fed. R. App. P. 4(a)(1)(A); the relator was entitled to use the 60-day period provided in cases involving the U.S., the court reasoned, because the government had intervened.
  • That the district court properly used Western Kentucky prevailing rates for most of the CIncinnati firm’s attorneys, with the exception of the lead attorney and his paralegal, whose expertise had been shown necessary.
  • That the use of 2007 rates (for a case filed in 2000 and settled in 2006) was appropriate due to the delay in the attorneys’ receiving payment.
  • That the time entries were sufficiently detailed.
  • That GE was not liable for attorney’s fees for first-to-file litigation in the case.
  • That the district court erred in not considering a some of the hours relating to litigation over the fee issue in applying the Circuit’s 3% cap on such costs.

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