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Don’t Throw Away Those Timesheets!

Recently, the Illinois Appellate Court reversed a legal fee award because the lawyers who obtained the award failed to retain copies of their written timesheets after they entered the data into a computer program. Aliano v. Sears, Roebuck & Co., 2015 IL App (1st) 143367.

The plaintiff sought recovery under the Consumer Fraud Act alleging that Sears had wrongfully collected sales tax on the entire sale price of certain digital-to-analog converter boxes even though a portion of the price was subsidized by a federal program which provided coupons that were exempt from Illinois sales tax.

Plaintiff was unsuccessful in obtaining class certification and opted to go to trial. At trial, plaintiff prevailed and won a judgment of $3.10. Plaintiff then filed a fee petition seeking $252,402.08 in legal fees. The circuit court conducted a hearing on the petition for legal fees and awarded $157,813.53. Sears appealed. Opinion ¶ 3.

The Appellate Court affirmed the judgment for $3.10, but reversed the award of attorney fees on the ground that the plaintiff’s law firm had failed to retain its time records after the time charges were input into legal billing software. The Appellate court held that it was an abuse of discretion for the circuit court to admit in evidence the computer generated billing records. The court explained: “The original time sheets underlying the July 31, 2013, billing statement, having been discarded by plaintiff’s attorneys, were not and could not, be produced. As a consequence, Sears was deprived of an opportunity to test the reliability and accuracy of the statement by comparing the entries contained therein with the original time sheets upon which those entries are based and through cross-examination of Mr. Zimmerman….” The court held it was error to admit the July 31, 2013 computer generated legal bill in the absence of the hand-written time sheets and reversed the case for further proceedings. Upon remand the plaintiff will have an opportunity to prove the “reasonable fees to which he is entitled through admissible evidence.” Opinion ¶ 34.

Comment: the court’s ruling is based on precedent and is understandable given the lawyers’ admission that they discarded their time sheets after entering the data in a computer. The case could be problematic in situations where lawyers do not use time sheets and instead enter their time in a computer program each day. Thus, if you use written time records, you should not throw them away until any legal fee litigation is resolved.

Edward X. Clinton, Jr.

The Clinton Law Firm