Who hasn’t experienced working so hard to get the case settled, only to have it held up by applicants' attorneys raising the issue of “unpaid” Labor Code Section 5710 fees?

Shannon M. Lang

Do you ever tire of receiving that standard bill from that one law firm demanding over $3,000 for taking a deposition that wasn’t out of the ordinary?

Take heart, my weary friends on the defendants' side of the aisle, as the Division of Workers' Compensation has now proposed a pathway to eliminate these frustrations in large part from our practice. Yet, there is still more road ahead before these proposed regulations are encoded into law.

Background

The DWC released a Newsline on Jan. 26, announcing that it would be posting draft regulations establishing ranges for attorney deposition fees.

The Newsline states that Workers' Compensation Appeals Board judges have discretion when awarding fees, which are required to be paid by the employer or its insurer. Fees are supposed to be governed by local policy established by a presiding judge in each district.

In reality, I don’t know many jurisdictions that publish established ranges for attorneys’ fees. Years ago, the presiding judge at the Salinas WCAB did so, and it was extremely helpful.

I rarely had to address a fee dispute because we always had clearly stated guidelines to help us navigate. These days, it seems like the parties are largely left to themselves to resolve the disputes and figure it out on their own. Otherwise, we wouldn’t constantly be asking each other whether or not X amount of dollars was too much to pay an attorney so-and-so who just sent us a bill for deposition fees.

Hearings and litigation over this issue have been a long-standing problem for defendants. Some of us simply roll over and pay the “extra” just to make it go away. Others fight tooth and nail as a matter of principle over paying exorbitant fees.

This all points to the fact that a codified guideline establishing attorney fees and what cannot be billed to the defendant needs to be implemented. If uniform guidelines are in place, this will eliminate disputes and free up the WCAB to address other important matters. There are shortages of WCAB judges at this moment at certain district offices. An LC 5710 fee schedule will also help lighten these overworked judges’ workload by eliminating the need to hear and decide attorney fee disputes.

The proposal

For depositions of the applicant, the DWC has proposed maximum hourly rates that attorneys and non-attorneys can charge. That rate is a maximum of $500 per hour for a certified workers’ compensation specialist (certified by the California State Bar); a maximum of $450 per hour for an attorney with five or more years of experience in workers’ compensation in California; a maximum of $400 for an attorney with fewer than five years of experience; and a maximum of $250 for a non-attorney representative (such as a hearing representative).

Billing must be submitted in increments of one-tenth of an hour (.1). No minimum or flat fees are permitted.

If a hearing representative or non-attorney representative appears at the deposition, under these proposed regulations, that person is mandated to clearly state his status on the record.

The following charges are not allowed to be requested or awarded: general file review, travel time for travel expenses, review of deposition transcripts, and administrative or clerical tasks.

My take

Each jurisdiction will have its own unique stories with these issues, but I can tell you a few of my personal experiences that have led me to voice my full support of the DWC proposed regulations.

Remember that one law firm I mentioned that sends a $3,000 bill for a deposition? Each invoice it submits includes general file review, travel time (even when the deposition was remote), review of the deposition transcript, and clerical tasks.

Most of the time, when we receive the invoice, the deposition transcript has not even issued yet. Therefore, we often see applicants' attorneys billing for reviewing a deposition transcript that hasn’t even issued yet. We also have no way of knowing if she actually reviewed the transcript with the client (most of the time).

I’ve seen invoices submitted for travel, even when the deposition was remote. To that end, in my humble opinion, there should be limited circumstances where a deposition would be needed in person these days. COVID significantly changed the way we conduct business. We can often just as successfully depose an applicant via Zoom rather than in a crowded conference room.

Remote depositions save defendants money. We, as defense attorneys, should be examining whether or not an in-person deposition is truly required. To be fair, this may vary from jurisdiction to jurisdiction or even person to person, for that matter.

We often get invoices billing for “wait time” or “set up with client on Zoom.” Those are administrative tasks and should not be billed to the defendant. It’s about time to trim that off the bill.

I’ve had many depositions where I have had to very intentionally ask who is appearing and whether he is an attorney or not. The court reporters don’t always ask whether the person is an attorney, although ideally, they should.

Mandating a hearing representative or non-attorney to state his position on the record should have been something that was instituted long ago. It should not be something that is hidden from us, for that matter.

The proposed guidelines for attorney fees provide parties with a clear structure. They eliminate the guesswork. LC 5710 fee guidelines will simplify the payment recommendations we make to our clients. They will eliminate unnecessary litigation and should streamline payments getting issued to applicants' attorneys. They will clean up any abuse and waste. Settlements shouldn’t have to be held up one moment longer.

It is time for a change.

What the DWC has proposed comes down to common sense. It is a logical framework, giving long-awaited structure to our practice on how to address attorney fee requests after a deposition. I do not know who is behind the proposed regulations, but I stand with them, and I say thank you.

What's next

The DWC accepted public comments on the issue. Comments closed on Feb. 13.

The applicants' bar has been very vocal (that is an understatement) in its disapproval of the proposed regulations. Comments submitted by the defense side tend to be in favor of approving the regulations.

Here’s hoping for some much-needed change.

Shannon M. Lang is a partner at Bradford and Barthel’s Fresno office. This entry from Bradford & Barthel's blog appears with permission.