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Clemens v. New York Central Mutual Fire Insurance Co.

United States Court of Appeals, Third Circuit

September 12, 2018

BERNIE CLEMENS; NICOLE CLEMENS, Appellants
v.
NEW YORK CENTRAL MUTUAL FIRE INSURANCE COMPANY, And/Or NYCM Insurance Group And/Or NYCM Holdings, Inc.

          Submitted Under Third Circuit L.A.R. 34.1(a) June 18, 2018

          Appeal from the United States District Court for the Middle District of Pennsylvania (D.C. Civ. Action No. 3-13-cv-02447) District Judge: Honorable Malachy E. Mannion

          James C. Haggerty Haggerty Goldberg Schleifer & Kupersmith Michael R. Mey Mey & Sulla Michael J. Pisanchyn Pisanchyn Law Firm Counsel for Appellants

          Charles E. Haddick, Jr. Dickie McCamey & Chilcote Counsel for Appellee

          Before: GREENAWAY, JR., RESTREPO, and BIBAS, Circuit Judges.

          OPINION

          GREENAWAY, JR., CIRCUIT JUDGE.

         After a jury awarded him $100, 000 in punitive damages under the Pennsylvania Bad Faith Statute, 42 Pa. Cons. Stat. § 8371, Appellant Bernie Clemens submitted a petition for over $900, 000 in attorney's fees from Appellee New York Central Mutual Fire Insurance Company ("NYCM"). The District Court denied this petition in its entirety, reasoning that it was not adequately supported and that the requested amount was grossly excessive given the nature of the case. Finding no abuse of discretion, we will affirm and, in doing so, take the opportunity to formally endorse a view already adopted by several other circuits-that is, where a fee-shifting statute provides a court discretion to award attorney's fees, such discretion includes the ability to deny a fee request altogether when, under the circumstances, the amount requested is "outrageously excessive." Brown v. Stackler, 612 F.2d 1057, 1059 (7th Cir. 1980); see also, e.g., Envtl. Def. Fund, Inc. v. Reilly, 1 F.3d 1254, 1258-60 (D.C. Cir. 1993); Fair Hous. Council of Greater Wash. v. Landow, 999 F.2d 92, 97 (4th Cir. 1993); Lewis v. Kendrick, 944 F.2d 949, 956-58 (1st Cir. 1991).

         I. BACKGROUND

         Dissatisfied with NYCM's handling of his insurance claim related to a serious car accident, Clemens filed suit against the company in the Court of Common Pleas of Monroe County, asserting a contractual underinsured motorist ("UIM") claim and a claim under the Bad Faith Statute, 42 Pa. Cons. Stat. § 8371. After NYCM removed the case to federal court, the parties settled the UIM claim for $25, 000. The bad faith claim, meanwhile, proceeded to a week-long trial, at the conclusion of which a jury found that NYCM had acted in bad faith in its handling of the insurance claim and awarded Clemens $100, 000 in punitive damages.

         As the prevailing party under the Bad Faith Statute, Clemens then submitted a petition for attorney's fees, in which he requested an award of $946, 526.43 in fees and costs.[1] The District Court denied this request in its entirety, however. In a thorough and well-reasoned one-hundred-page opinion, the court reviewed every time entry submitted, performed a traditional lodestar analysis, and concluded that eighty-seven percent of the hours billed had to be disallowed as vague, duplicative, unnecessary, or inadequately supported by documentary evidence. In light of that substantial reduction, the District Court deemed Clemens's request "outrageously excessive" and exercised its discretion to award no fee whatsoever. App. 649. Represented by new counsel, Clemens now appeals.[2]

         II. JURISDICTION

         The District Court had jurisdiction under 28 U.S.C. § 1332(a), and we have jurisdiction under 28 U.S.C. § 1291.

         III. ...


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