Northwinds Abatement v. Employers Ins Wausau ( 2001 )

Revised July 27, 2001
UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
_______________________
No. 00-20380
_______________________
NORTHWINDS ABATEMENT, INC.
Plaintiff-Appellee,
versus
EMPLOYERS INSURANCE OF WAUSAU,
Defendant-Appellant.
______________________________________________________________
Appeal from the United States District Court
for the Southern District of Texas
_________________________________________________________________
July 11, 2001
Before KING, Chief Judge, REAVLEY and JONES, Circuit Judges.
EDITH H. JONES, Circuit Judge:
In the second appearance of this case before us on
appeal, Employers Insurance of Wausau (“Wausau”) appeals a jury
verdict in favor of Northwinds Abatement, Inc. (“Northwinds”) and
the resulting judgment of nearly $1.1 million, including actual and
treble damages, attorney’s fees, interest and costs. Wausau
asserts that, as a servicing company, it was an agent of the Texas
Workers’ Compensation Insurance Facility (the “Facility”) and
therefore exempt from liability claims pursuant to now-superseded
Article 5.76-2, § 2.12 of the Texas Insurance Code. We disagree,
and affirm the district court’s holding that Wausau is not an agent
of the Facility. Wausau also argues that the claims underlying the
jury verdict are all invalid as a matter of law. Wausau is in part
correct, but under Texas law both the Texas Deceptive Trade
Practices Act (“DTPA”) and Insurance Code claims are viable, and we
must affirm the judgment on these extra-contractual claims.
Finally, although the award of statutory attorneys’ fees to
Northwinds is high, it is not reversible. The judgment is
AFFIRMED.
BACKGROUND
Northwinds is a corporation engaged in the hazardous
business of asbestos abatement, remediation and removal work.
Unable to obtain workers’ compensation insurance on the open
market, it applied for and received coverage through the Texas
Workers Compensation Insurance Facility, a private, nonprofit,
unincorporated association of insurers created by statute with the
purpose, inter alia, of providing coverage for employers who are
unable to obtain insurance in the voluntary insurance market.1 The
1
The Texas statutes establishing an insurer of last resort
for workers compensation insurance have been the subject of
frequent revision and redrafting. The Facility was formerly known
as the Texas Workers’ Compensation Assigned Risk Pool, with the
Facility replacing the Risk Pool on January 1, 1991. See Tex. Ins.
Code Ann. art. 5.76-2 (Vernon 1991)(amended 1993 and repealed 1997,
now Tex. Ins. Code Ann. art. 21.28-C (Vernon 2000)). On January
1, 1994, the Texas Workers’ Compensation Insurance Fund replaced
the Facility as the insurer of last resort. See id. (1993
revision). While the Fund retained its name, the statutes governing
2
Facility designated Wausau as the primary “servicing company” for
Northwinds and Wausau subsequently issued Northwinds a workers’
compensation policy.2
In 1993 Northwinds filed suit against Wausau for alleged
mishandling of workers’ compensation claims filed by four
Northwinds employees. Northwinds alleged that Wausau paid these
four claims without properly investigating them, thereby causing
increased insurance premiums for Northwinds and a loss of business
due to the customer perception that Northwinds was a safety risk.
Northwinds characterized its claims as raising fraudulent and bad
faith settlement practices, breach of contract, negligence,
violations of the Texas DTPA and violations of the Texas Insurance
Code.
again changed in 1997. See Tex. Ins. Code Ann. art. 5.76-3 and
art. 21.28-C §§ 26, 27. (Vernon 2000).
2
The servicing company contracts with the Facility to
issue policies evidencing the insurance coverage provided and to
service the risk. While the servicing company is the issuer of the
policy, the Facility itself is the insurer. The members of the
Facility collectively reinsure each policy it issues, dividing
reinsurance liability in proportion to premiums received by each
member.
Notwithstanding its limited liability, the servicing company
still performs many of the traditional functions of an insurer.
The servicing company issues the policy; investigates, reports, and
pays claims; inspects and classifies risks; and provides legal
support as required by the policy. See Tex. Ins. Code Ann. art.
5.76-2.
The operational mechanics of the Facility are discussed at
length in the earlier appeal of this case. See Northwinds
Abatement, Inc. v. Employers Insurance of Wausau, 69 F.3d 1304,
1305-06 (5th Cir. 1996)(Northwinds I).
3
Northwinds’ suit was removed to federal court, where
Wausau filed a motion to dismiss for lack of subject matter
jurisdiction, citing Northwinds’ failure to exhaust its
administrative remedies through the Facility and the Texas
Department of Insurance. The district court denied this motion.
Wausau then moved for summary judgment, contending that it was not
liable to Northwinds because it was only a servicing company for
the Facility and not Northwinds’ insurer. When the district court
granted this motion, Northwinds appealed. On appeal, Wausau
renewed its challenge to the district court’s jurisdiction.
This court determined that, pursuant to the doctrine of
primary jurisdiction, the district court had jurisdiction because
the remedies sought by Northwinds could not be provided
administratively. See Northwinds Abatement, Inc. v. Employers
Insurance of Wausau, 69 F.3d 1304 (5th Cir. 1995) (Northwinds I).
However, this court also determined that the district court should
abstain from resolving Northwinds’ claims until certain factual
determinations were made in the administrative proceedings.
Rejecting Northwinds’ claim for breach of the duty of good faith
and fair dealing, the court nevertheless reversed the summary
judgment as to all other claims. See Northwinds I, 69 F.3d at
1311-12.
In September 1998, the district court held that
Northwinds had exhausted all avenues of administrative review, and
the case approached trial. Wausau filed a last-minute motion for
4
summary judgment, asserting that it was an agent of the Facility
and, as such, protected from liability under Article 5.76-2, § 2.12
of the Texas Insurance Code. After supplemental briefing on the
issue, the district court denied the motion, and the case went to
trial.
The jury returned a verdict in favor of Northwinds on all
claims except that for breach of contract. The jury awarded actual
damages of $19,234.95 for the increased premiums Northwinds was
forced to pay, $55,335.49 for attorneys’ fees incurred in defending
the lawsuit initiated against it by the Facility at Wausau’s
urging, and $712,000 in attorneys’ fees incurred in the federal
suit against Wausau. The district court entered a judgment
awarding Northwinds $74,570 in actual damages, $223,711.32 in
treble damages, $712,000 in attorneys’ fees, prejudgment interest
on the actual damages, post-judgment interest, and costs. Wausau
now appeals.
WAUSAU AS AN “AGENT” OF THE FACILITY
Wausau first argues that as a servicing company, it is an
agent of the Facility and thereby immune from liability under
Article 5.76-2, § 2.12 of the Texas Insurance Code.
Article 5.76-2, § 2.12 states in relevant part that:
“There shall be no liability on the part of and no cause
of action shall arise against the governing committee,
the facility, its executive director, or any of its
staff, agents, servants, or employees arising out of or
in connection with any judgment or decision made in
connection with the performance of the powers and duties
5
under this article or for recommendation or decision
concerning any inspections or safety engineering
investigations performed or for any recommendation or
decision made in good faith”. (Emphasis added).
According to Wausau, this court has already deemed it an
agent of the Facility, based on the conclusion in Northwinds I that
“an agent [Wausau] may be liable for its own acts of negligence or
fraud”. 69 F.3d at 1311. Wausau takes this as a judicial
determination that it is an agent of the Facility. Further, Wausau
argues that this court’s invocation in Northwinds I of Maintenance,
Inc. v. ITT Hartford Group, Inc., 895 S.W.2d 816 (Tex.App.--
Texarkana 1995) (“Maintenance III”), demonstrates that Wausau has
already been determined to be the agent of the Facility.
We disagree that Wausau’s agency status under § 2.12 was
determined in Northwinds I. That opinion explicitly refused to
consider whether Wausau was an agent of the Facility for § 2.12
purposes. See Northwinds I, 69 F.3d at 1308, n.3. Additionally,
the citation in Northwinds I to Maintenance III represented not a
wholesale adoption of the Texas intermediate court of appeals’
opinion, but an acknowledgment that the Maintenance III decision
had been withdrawn and substantially modified. See id. at 1311.
Thus, the law of the case does not govern Wausau’s status as an
agent under § 2.12.
Whether a “servicing company” is an “agent” of the
Facility is a novel question of Texas law. Article 5.76-2 of the
Texas Insurance Code does not define an “agent.” It defines a
6
“servicing company” as “a member of the facility or other eligible
entity that is designated by the board to issue a policy that
evidences the insurance coverages provided by the fund to a
rejected risk and to service the risk as provided by this article.”
Tex. Ins. Code Ann. art. 5.76-2, § 1.01(12). A “member,” in turn,
is defined as “an insurer that is a member of the facility.” Id.
at § 1.01(15). We have found no evidence that the Texas
Legislature intended to protect servicing companies from liability
in § 2.12, and the Texas Supreme Court has never considered this
issue.3 Texas intermediate court decisions contain offhand
references to servicing companies as agents of the Facility, but
they are not definitive.4
3
It is worth noting that other, more recent, Texas
statutes explicitly grant immunity to member insurers. For
example, in the context of the Texas Property and Casualty
Insurance Guaranty Association “[t]here is no liability on the part
of, and no cause of action of any nature arises against any member
insurer [of the Association] . . . for any good faith action or
failure to act in the performance of powers and duties under this
Act.” See Tex. Ins. Code Ann. art. 21.28-C, § 16(a) (Vernon 2000).
This indicates that had the Texas Legislature sought to grant
similar immunity to members of the Facility in art. 5.76-2, it
would have so stated.
4
A
few Texas courts of appeals have, with little
discussion or analysis, labeled servicing companies as the agents
of the Facility for the limited purpose of issuing a policy. See,
Maintenance, Inc. v. ITT Hartford Group, 895 S.W.2d 816, 818 (Tex.
Ct. App.--Texarkana 1995, writ denied) (Maintenance III)(holding
that the servicing company is an “agent to issue a policy for the
pool.”); Tex. Workers Comp. Ins. Facility v. Peakload, Inc., 1998
WL 798640, at *1 (Tex. Ct. App. - Austin, 1998) (unpub.) (“The
servicing company
is simply an agent that issues a policy for the pool.”). However,
these cases do not discuss subsequent transactions, such as claims
handling.
7
The structure of the Insurance Code offers the only
direct interpretive information, and it suggests that § 2.12 does
not apply to servicing companies. Article 5.76-2 of the Texas
Insurance Code is divided into five parts. Part 2, in which § 2.12
is found, does not discuss or even mention servicing companies.
Part 4, in turn, sets out the rules governing servicing companies
but contains no exemption from liability comparable to § 2.12.
Under the doctrine of ejusdem generis, the term “agent” in § 2.12
should be restricted to the class of persons enumerated in Part 2.
See Dawkins v. Meyer, 825 S.W.2d 444, 447 (Tex. 1992)(outlining the
doctrine of ejusdem generis and explaining that “where specific and
particular enumerations of persons or things are followed by
general words . . . , the general words are not to be construed in
their widest meaning or extent, but are treated as limited and
applying only to persons or things of the same kind or class as
those expressly mentioned.”). Viewed thus in context, “agent” must
be a term related to the Facility, its governing body and
employees, and not to the members or to servicing companies.
Wausau’s attempt to shelter itself under the wing of Part 2 of the
Insurance Code thus seems ill-conceived.
Moreover, the ordinary meaning of the term “agent” also
fails to express Wausau’s relationship with the Facility. In
Texas, “[a]gency is a legal relationship created by an express or
implied agreement or by operation of law whereby the agent is
8
authorized to act for the principal, subject to the principal’s
control.” Karl Rove & Co. v. Thornburgh, 39 F.3d 1273, 1295-96
(5th Cir. 1994). The essential element in determining agency
relationship is the principal’s right to control the agent: “To
prove an agency relation under Texas law, there must be evidence
from which the court could conclude that ‘[t]he alleged principal
[had] the right to control both the means and the details of the
process by which the alleged agent [was] to accomplish the task.’”
Id. (quoting In re Carolin Paxson Adver., Inc., 938 F.2d 595, 598
(5th Cir. 1991)). “The right to control the details of a person’s
work determines whether an employment or independent contractor
relationship exists.” Weidner v. Sanchez, 14 S.W.3d 353 (Tex. Ct.
App.-- Houston [14th Dist.] 2000, writ denied). The portion of the
Texas Insurance Code detailing the relationship between the
Facility and the servicing companies leaves substantial discretion
to the servicing company to determine the means for accomplishing
its tasks. See Tex. Ins. Code Ann. Art. 5.76-2, § 4.08. The
Facility’s lack of control over how the servicing company
accomplishes its designated tasks indicates that the servicing
company is not an agent of the Facility.
This conclusion is also supported by the contract between
the Facility and Wausau, which states that Wausau is an independent
contractor, and that the company retains the right to control the
means, manner, and details of fulfilling its obligations under the
agreement. Under Texas law, “[a] written contract that expressly
9
provides for an independent contractor relationship is
determinative of the parties’ relationship in the absence of
extrinsic evidence indicating that the contract was subterfuge,
that the hiring party exercised control in a manner inconsistent
with the contract provisions, or if the written contract has been
modified by a subsequent agreement, either express or implied.”
Weidner, 14 S.W.3d at 353. There is nothing in the record to
indicate that the Facility exercised a greater level of control
over Wausau’s work than that specified in the contract. For all
these reasons, Wausau is not an agent of the Facility, it cannot
take refuge behind § 2.12, and Northwinds’ claims are not barred.
NORTHWINDS’ FRAUD, NEGLIGENCE AND STATUTORY CLAIMS
Five theories of liability were submitted to the jury in
this case: statutory claims under the DTPA and Insurance Code, and
common law theories of breach of contract, fraud and negligence.
The jury found in Northwinds’ favor on all but the breach of
contract claim. Wausau now challenges both the legal basis for
these claims and the sufficiency of the evidence supporting each of
them. We review questions of law de novo, while the sufficiency of
the evidence is reviewed by examining all the evidence in the light
most favorable to the verdict.5 See Hollowell v. Orleans Reg’l
5
Northwinds contends that Wausau did not properly preserve
error and that, as such, the fraud, negligence and statutory claims
should be reviewed only for plain error. We disagree. Wausau
adequately preserved error on these claims via its motion for
directed verdict, objection to the submission of certain jury
questions, opposition to Northwinds’ motion for judgment, and the
10
Hosp. LLC, 217 F.3d 379, 385 (5th Cir. 2000)(de novo standard for
questions of law); United States v. Guerrero, 234 F.3d 259, 261-62
(5th Cir. 2000) (stating the standard of review for sufficiency of
the evidence).
COMMON LAW CLAIMS
Wausau argues that Texas law does not recognize causes of
action for negligent claims handling or fraud in regard to the
subject matter of the contract and that the jury’s findings on
those issues must be overturned.6 This is correct. In
Higginbotham v. State Farm Mut. Auto Ins. Co., 103 F.3d 456, 460
(5th Cir. 1997), this court recognized the absence of a cause of
action for negligent claims handling under Texas law.7 Negligent
post-trial renewal of its motion for a directed verdict.
6
Northwinds elected to recover judgment under the Texas
Insurance Code claim, but Wausau, to prevail on appeal, would have
to overturn the common law claims as well.
7
Interpreting Texas law, a federal district court has
clearly analyzed this issue:
A tort claim has been found to arise out of the breach of
an insurance carrier’s contractual duty in only two
instances: (1) when the insurer breaches its duty of good
faith and fair dealing or (2) when the insurer fails to
exercise ordinary care and prudence in considering an
offer of settlement within the policy limits. All other
claims, like that asserted for negligent claims handling,
have no legally independent basis and, therefore, are
regarded merely as actions for breach of contract.
French v. State Farm Ins. Co., 156 F.R.D. 159, 162 (S.D.
Tex. 1994).
11
claims handling is subsumed into breach of contract except under
very limited circumstances. In examining whether an action sounds
in contract or tort, the Texas Supreme Court has declared that
“[i]f the defendant’s conduct . . . would give rise to liability
independent of the fact that a contract exists between the parties,
the plaintiff’s claim may also sound in tort.” Southwestern Bell
Tel. Co. v. Delanney, 809 S.W.2d 493, 494 (Tex. 1991) (emphasis
added). Similarly, for an action to sound in fraud instead of
breach of contract, Wausau’s fraudulent conduct must give rise to
liability independent of the contract. Id. The Texas Supreme
Court held there that “[w]hen the only loss or damage is to the
subject matter of the contract, the plaintiff’s action is
ordinarily on the contract.” Id. The essence of Northwinds’
common law claims lay in Wausau’s false statement that it was fully
investigating the disputed workers compensation claims and in the
resulting damages from increased premium payments when Northwinds
was rendered unable to contest the claims. No liability
independent of the contractual duty to handle claims exists as a
result of this false statement. Neither of the common law claims
can be sustained under Texas law.
STATUTORY CLAIMS
Certain statutory causes of action exist in Texas under
the DTPA and the Insurance Code, however, regardless whether the
plaintiff also has a viable breach of contract claim. See First
12
Title of Waco v. Garrett, 860 S.W.2d 74, 76-77 (Tex. 1993); Jack B.
Anglin Co., Inc. v. Tipps, 842 S.W.2d 266, 270-71 (Tex. 1992); Vail
v. Texas Farm Bureau Mut. Ins. Co., 754 S.W.2d 129, 136 (Tex.
1988).8 Further, a servicing company of the Facility can be liable
in its individual capacity for violations of the DTPA and the
Insurance Code. See Maintenance III, 895 S.W.2d at 819. Where, as
here, there has been no breach of contract or violation of the duty
of good faith and fair dealing, the bar for establishing extra-
contractual liability is high: the insurer must “commit some act,
so extreme, that [it] would cause injury independent of the policy
claim.” Republic Ins. Co. v. Stoker, 903 S.W.2d 338, 341 (Tex.
1995).
Wausau’s successful efforts to persuade the Facility to
sue Northwinds baselessly involved acts that a reasonable jury
could find extreme, and they clearly caused Northwinds extra-
contractual damages, as the company had to spend over $55,000
defending itself against the lawsuit. Examined under the
deferential standard of appellate review, the evidence supports the
finding of an extreme extra-contractual act sufficient to satisfy
the Stoker standard.
8
An Insurance Code claim based on breach of the duty of
good faith and fair dealing will generally fail in the absence of
a viable breach of contract claim. Northwinds’ claims did not
depend on good faith and fair dealing alone but also on
misrepresentation.
13
ATTORNEYS’ FEES
Wausau challenges the jury’s award of $712,000 in
attorneys’ fees to Northwinds as both insufficiently supported by
the evidence and excessive. In diversity cases such as this one,
attorneys’ fee awards are governed by state law. Mid-Continent
Casualty Co. v. Chevron Pipe Line Co., 205 F.3d 222, 230 (5th Cir.
2000).
The Texas Insurance Code provides for a non-discretionary
award of attorneys’ fees to prevailing parties. See Tex. Ins. Code
art. 21.21 § 16. A plaintiff is entitled to attorney’s fees that
are “reasonable and necessary” for the prosecution of the suit.
See Stewart Title Guar. Co. v. Sterling, 822 S.W.2d 1, 10 (Tex.
1992). The party seeking to recover attorneys’ fees bears the
burden of proof on the issue. However, where the party seeking
attorneys’ fees offers reasonable and credible testimony concerning
the fees, and the party opposing the attorneys’ fees has the
opportunity to contradict or disprove the testimony and fails to do
so, the testimony of the witness may be taken as true as a matter
of law. See Ragsdale v. Progressive Voters’ League, 801 S.W.2d
880, 882 (Tex. 1990) (“In order for the court to award an amount of
attorneys’ fees as a matter of law, the evidence from an interested
witness must not be contradicted by any other witness or attendant
circumstances and the same must be clear, direct and positive, and
free from contradiction, inaccuracies and circumstances tending to
14
cast suspicion thereon.”); see also Brown v. Bank of Galveston, 963
S.W.2d 511, 515 (Tex. 1998).
The jury’s verdict was within the range of evidence
presented. The only evidence concerning attorneys’ fees was the
testimony of John McEldowney, a veteran Texas attorney. McEldowney
properly laid out the factors identified by the Texas Supreme Court
for consideration in determining an award of attorneys’ fees.9
Wausau presented no evidence controverting McEldowney’s testimony,
and Wausau hardly cross-examined him.
Wausau contends, nevertheless, that because the contract
between Northwinds and its attorneys established only a contingency
fee, there is insufficient evidence to support the jury’s award of
9
In Arthur Andersen & Co. v. Perry Equipment Corp., 945
S.W.2d 812, 818 (Tex. 1997), the Texas Supreme Court identified
eight factors to be considered in evaluating the reasonableness of
attorneys’ fees: “(1) the time and labor required, the novelty and
difficulty of the question involved, and the skill required to
perform the legal service properly; (2)the likelihood . . . that
the acceptance of particular employment will preclude other
employment by the lawyer; (3) the fee customarily charged in the
locality for similar legal services; (4) the amount involved and
the result obtained; (5) the time limitations imposed by the client
or the circumstances; (6) the nature and length of the professional
relationship with the client; (7) the experience, reputation, and
ability of the lawyer or lawyers performing the services; and (8)
whether the fee is fixed or contingent on results obtained or
uncertainty of collection before the legal services have been
rendered.” McEldowney identified and discussed each of these
factors in relation to this case. These factors are virtually
identical to those examined by federal courts in awarding
attorneys’ fees. See Johnson v. Georgia Highway Express, Inc., 488
F.2d 714, 717-19 (5th Cir. 1974).
15
fixed-rate (hourly billed) attorneys’ fees to Northwinds.10 We
disagree. In situations where counsel and client have entered into
a contingency fee arrangement, Texas law requires the finder of
fact to calculate a statutorily-founded award of reasonable and
necessary attorneys’ fees as a dollar amount rather than as a
percentage of the overall recovery. See Arthur Andersen, 945
S.W.2d at 819 (interpreting fee-shifting provision of Texas DTPA).
There is no reason why the Insurance Code’s fee-shifting provision
should be treated differently. This point is meritless.
Wausau also contends that, regardless of the sufficiency
of the evidence, the award of $712,000 in attorneys’ fees was
excessive. This court reviews whether the district court abused
its discretion in refusing to reduce an excessive award of
attorneys’ fees. See Mid-Continent, 205 F.3d at 232; Romaguera v.
Gegenheimer, 162 F.3d 893, 896 (5th Cir. 1998).
In deciding whether a fee is excessive, an appellate
court is “entitled to look at the entire record and to view the
10
Indeed, it is odd that Wausau now objects to the jury’s
adoption of an hours-billed based fee, when in its cross
examination of McEldowney Wausau seemingly attempted to persuade
the jury to adopt a fixed-fee award. Wausau’s attorney appeared to
attack the contingent fee model, inquiring of Mr. McEldowney
“[d]on’t you think that a better way for determining whether a
person should unwillingly be forced to pay a fee would be to look
at the actual value of the actual work done, rather than some
voluntary agreement that the law firm suing had with their client?”
Mr. McEldowney responded negatively, but the jury obviously agreed
with Wausau’s counsel, opting for an “actual value of actual work
done” fixed fee model over the contracted-for contingency model.
16
matter in the light of the testimony, the amount in controversy,
the nature of the case, and our common knowledge and experience as
lawyers and judges.” Mid-Continent, 205 F.3d at 232 (quoting Giles
v. Cardenas, 697 S.W.2d 422, 429 (Tex. App. 1985, writ ref’d
n.r.e.)). All of the factors outlined by this court in Johnson v.
Georgia Highway Express, Inc., 488 F.2d 714, 717-19 (5th Cir.
1974), and subsequently adopted into Texas law by the Texas Supreme
Court are to be considered. See Arthur Andersen, 945 S.W.2d at
818. However, it is well established that the most critical factor
in determining an award of attorneys’ fees is the “degree of
success obtained” by the victorious plaintiffs. Romaguera, 162
F.3d at 896 (quoting Hensley v. Eckerhart, 461 U.S. 424, 434
(1983)). Moreover, the requested fees must bear a reasonable
relationship to the amount in controversy or to the complexity of
the case. Jerry Parks Equip. Co. v. Southeast Equip. Co., 817 F.2d
340, 344 (5th Cir. 1987).
The award of $712,000 as attorneys’ fees in this case was
more than three times the trebled damages award and more than nine
times the actual damages. Such disproportion alone does not render
the award of attorneys’ fees excessive. See Gorman v. Countrywood
Property Owners Assoc., 1 S.W.3d 915, (Tex. Ct. App.--Beaumont
1999, pet. denied)(attorney’s fee award 2.5 times larger than
actual damages was not excessive). However, Northwinds’ attorneys
were not very successful in their prosecution of this suit:
following this decision, Northwinds will have prevailed on only two
17
of its original laundry list of claims; the actual damages awarded
to Northwinds are a tiny fraction of the multi-million dollar
recovery it sought; and Northwinds took nothing on its key theory
that Wausau’s actions reduced Northwinds’ profits by convincing its
customers and potential customers that it ran an unsafe operation.
Indeed, the only front on which Northwinds’ attorneys enjoyed
outright success was in convincing the jury to award full
attorneys’ fees.
On the other side of the ledger, this was a complex case
to litigate, as it involved two appeals to this court, the pursuit
of administrative remedies, and a full trial. We review an
attorneys’ fee award for abuse of discretion. Although the basic
damage award was far less than Northwinds sought, and although
Northwinds’ attorneys contractually agreed to a contingent fee, we
cannot overlook the complexity of the case, Wausau’s failure to
challenge the reasonableness of the fee amount, and the sound
judgment of the trial judge who shepherded this case. The award
must be sustained.
CONCLUSION
For the foregoing reasons, the judgment of the district
court is AFFIRMED.
18