What is the value of my/an insurance claim?
That questions is often asked and the answer will vary depending on many factors. However, one of the factors that is important and asked by people seeking legal advice is, “Can I get back my legal fees?”
This issue is discussed in a 2023 opinion from the Western District of Texas, Austin Division. The opinion is styled, Jyoti Singh v. Riversource Life Insurance Company. Only the part of this case discussing the standards for recovering legal fees will be discussed here.
To secure an award of attorneys’ fees from an opponent, the prevailing party must prove that: (1) recovery of attorneys’ fees is legally authorized, and (2) the requested attorneys’ fees are
reasonable and necessary for the legal representation, so that such an award will compensate the prevailing party generally for its losses resulting from the litigation process. Singh is clearly the prevailing party, and an award of attorneys’ fees is legally authorized through Texas Insurance Code, Section 542.060.
A determination of reasonable and necessary attorneys’ fees is premised on the application of the lodestar method. Courts in the Fifth Circuit apply the lodestar method to calculate attorneys’ fees. The lodestar amount is calculated by multiplying the number of hours an attorney reasonably spent on the case by an appropriate hourly rate. The appropriate hourly rate is defined by the market rate in the community in which the district court sits and should reflect the prevailing market rates, not the rates that lions at the bar may command. Litigants seeking attorneys’ fees have the burden to show the reasonableness of the hours billed and that the attorneys exercised reasonable billing judgment. The lodestar amount is entitled to a strong presumption of reasonableness.
After calculating the lodestar amount, the district court may adjust the amount of attorneys’ fees based on the twelve factors set forth in Johnson v. Georgia Highway Express, Inc. Many of these factors are subsumed within the initial calculation of hours reasonably expended at a reasonable hourly rate and should not be double-counted.
This Court then proceeded to evaluate what had occurred in this case.