*

11th Circuit appeal hangs over future whistleblower cases

*

White & Case wants fees in DOJ public records suit

*

Kasowitz resolves client dispute with billionaire banker

By Mike Scarcella and David Thomas

Sept 25 (Reuters) - (Billable Hours is Reuters' weekly

report on lawyers and money. Please send tips or suggestions to

[email protected].)

Humana is on the hook to pay more than $32 million

to attorneys for a tipster who won a $90 million settlement from

the insurance giant on behalf of the U.S. government, even as

another case threatens to wipe out the federal whistleblower

provision that allowed for the payouts.

Chief U.S. District Judge Greg Stivers in Louisville,

Kentucky, last week ordered Humana to cover legal fees and costs

for the whistleblower, former company actuary Steven Scott, as

the prevailing party in the litigation.

Scott, represented by law firms Kellogg Hansen and Phillips

& Cohen, accused Humana of overcharging the U.S. government for

prescription drugs. Humana settled last year while continuing to

deny the claims.

Humana did not immediately respond to a request for comment,

and its lawyers at O'Melveny & Myers declined to comment.

Scott sued Humana in 2016 under the False Claims Act, which

includes a provision allowing whistleblowers to pursue fraud

claims on behalf of the United States.

That provision is facing a major court challenge, after a

federal judge in Florida ruled last year that it is

unconstitutional. U.S. District Judge Kathryn Mizelle said the

provision unfairly allows whistleblowers to exercise federal

executive power without accountability to the president.

Most False Claims Act lawsuits are filed under the law's

"qui tam," or whistleblower, provisions, according to the U.S.

Justice Department. Whistleblowers last year filed 979 such

lawsuits, marking a new high for a single year.

The law's whistleblower provisions, which Congress

strengthened in 1986, helped to fuel more than $2.4 billion in

settlements and judgments last year.

The Atlanta-based 11th U.S. Circuit Court of Appeals is

expected to take up the Florida case in December. The U.S.

Chamber of Commerce and other groups have urged the court to

uphold Mizelle's ruling, while the U.S. Justice Department has

backed the lawfulness of the whistleblower provision.

Longtime appellate attorney Kannon Shanmugam of Paul Weiss

is set to argue the challenge to the whistleblower provision at

the appeals court, facing off against consumer advocate Tejinder

Singh of law firm Sparacino. The 11th Circuit case would not

affect the Humana litigation.

Whistleblowers are entitled to a 15% to 25% cut of proceeds

when the government intervenes in a False Claims Act case and

helps to litigate it. When the government does not intervene, as

in Scott's lawsuit, the amount is 25% to 30%.

Scott received 29% of the $90 million Humana settlement, or

$26.1 million, according to court records. He paid his lawyers

$10.44 million based on his contingency fee arrangement with

them, a filing showed.

Scott's lawyers argued that they were entitled to tens of

millions of dollars more under a fee-shifting provision of the

False Claims Act.

Humana contested the amount, saying Scott's Washington and

San Francisco-based lawyers were claiming "shockingly high"

rates for litigating in Kentucky.

Stivers in an order on September 9 found Scott's case

justified rates higher than those in Kentucky. Still, the court

agreed with a magistrate judge who earlier declined to back a

larger request for $41 million in fees and costs.

Scott's lawyers included Andrew Shen of Kellogg Hansen and

Claire Sylvia of Phillips & Cohen. They had no immediate

comment.

Shen, in a court filing, said he billed last year at $1,470

and is billing this year at $1,600. Sylvia's 2024 rate was

$1,075, and she is billing now at $1,160, court records show.

- White & Case has asked a U.S. judge in Washington to award

the firm $510,000 for its work in a public records lawsuit

against the U.S. Justice Department.

The firm's request on Tuesday criticized what it called the

DOJ's "stonewalling litigation tactics" in the Freedom of

Information Act case. It also said the requested amount was less

than half of the fees the plaintiff, Richard Usher, incurred

during the litigation.

Usher was a former top London-based currency trader for

JPMorgan who was acquitted in a 2018 federal criminal antitrust

trial. In 2023, he sued the DOJ over its alleged refusal to turn

over U.S. records that were part of his prosecution.

Usher's attorneys said the DOJ withdrew legal arguments it

made to justify withholding documents, "a tacit acknowledgement

that Mr. Usher never should have had to expend so much time and

effort to get the relief he did."

The Justice Department and a top lawyer for Usher declined

to comment.

- Two months after suing the billionaire founder of

Britannia Financial Group over nearly $500,000 in allegedly

unpaid legal fees, U.S. law firm Kasowitz LLP said it had

resolved its dispute.

The Kasowitz firm had represented Julio Martin

Herrera-Velutini as he faced U.S. criminal charges for allegedly

paying $300,000 to political consultants supporting Puerto Rico

Governor Wanda Vazquez during her 2020 election campaign. The

firm said in May 2024 it was withdrawing from Herrera's legal

team, but did not say why.

Herrera pleaded guilty to a misdemeanor charge for

violating the Federal Electoral Campaign Act in August. His

sentencing is set for December.

Kasowitz had

sued Herrera

in Manhattan federal court in July, alleging he failed to

pay the firm's legal fees.

"The matter has been resolved, and we look forward to

continuing the relationship with Mr. Herrera-Velutini," a

Kasowitz spokesperson said in a statement Wednesday. The

spokesperson declined to provide additional details.

Attorneys for Herrera-Velutini did not immediately

respond to a request for comment.

Read more:

Arnold & Porter filings detail Brazil work as tariff dispute

looms

Live Nation, law firm Latham face scrutiny over arbitration

bid in ticket pricing case

Google trial ends with $425 million verdict after Cooley

inherits privacy case

Law firm rates, revenues soar but costs pile up in AI era