BEAUMONT — A Texas appeals court has reversed a ruling awarding more than $250,000 in legal fees to a television station.
The issue dates to a 2012 report on Beaumont’s KBMT-TV alleging the Texas Medical Board punished Minda Lao Toledo after finding “she engaged in sexual contact with a patient and became financially involved with a patient in an inappropriate manner.” Toledo filed a defamation suit against KBMT, and, ultimately, the Texas Supreme Court granted the station’s motion to dismiss the complaint in accordance with the Telephone Citizens Protection Act.
The Supreme Court remanded the case for a trial on KBMT’s claims for an award of legal fees, punitive damages and court costs. Attorney Michael McCabe asked a 128th District Court judge to award $256,689 in legal fees and $1,468 in court costs. After an April 2017 trial on the fee request, McCabe filed a supplemental affidavit seeking an extra $50,000 in attorney fees contingent on appeals. The final award didn’t include that request.
Toledo appealed the award to the Texas Ninth District Court of Appeals. Justice Hollis Horton wrote the opinion issued June 13. Justices Charles Kreger and Leanne Johnson concurred.
The panel said the trial court’s ruling on KBMT’s request came before a clarification the Texas Supreme Court issued in Rohrmoos Venture v. UTSW DVA Healthcare concerning the way lower courts use the lodestar method and other factors to evaluate fee requests.
Toledo argued that KBMT failed to prove the awarded amount was reasonable, citing 11 reasons for her position. The panel agreed, with Horton writing the court “accepted McCabe’s rather conclusory testimony asserting the hours worked were reasonable based on his evaluation of his firm’s bills.”
Among the flaws identified were invoices showing many attorneys billing many hours for what appears to constitute work on the same briefs, “Yet when McCabe testified, he failed to offer an adequate explanation about why the layers of work reflected by the different lawyers working on the case were reasonable given the limited scope of the issue central to each stage of the dispute, whether KBMT’s broadcast was substantially true.”
The trial evidence also didn’t show how much money was at stake, an omission the panel said might lead a lower court to awarding a disproportionate amount of fees.
“The efforts of KBMT’s attorneys revolved around a motion to dismiss and two appeals,” Horton wrote. “There was no trial. The invoices do not show that much discovery occurred. The record does not show whether Toledo was suing KBMT for $10,000 or $1 million.”
The panel said Toledo “identified many items in the firm’s invoices that reflected duplicative, excessive, or inadequately documented work,” and that the legal work should’ve narrowed during the appeals process, but KBMT’s bills increased at each stage of proceedings.
Finding the trial court’s fee award “excessive and extreme,” the panel reversed the award of $256,689 and remanded the case for a new trial on the amount KBMT should be allowed to reasonably cover for its expenses in defending the defamation suit.