JACKSON, Miss. (Legal Newsline) - AT&T must pay a lawyer for time he spent proving the telecommunications firm wasn’t telling the truth when it said a member of his firm canceled its 1-800 number, the Mississippi Supreme Court ruled.
After further investigation, AT&T admitted it had canceled the toll-free number for George W. Healy, V & Associates and reassigned it to a medical provider. Healy sued in his own name and his firm’s, seeking $500,000 in lost earnings he attributed to the cancellation of the number in July 2018. He only discovered it after a colleague told him the number didn’t work.
AT&T restored service in January 2019. AT&T initially told the court a Healy employee had canceled the toll-free number. But in a later deposition, an AT&T employee said the company had unilaterally shut it off.
A trial judge awarded Healy nominal damages of $500, finding the law firm didn’t provide evidence to show its income fell directly because of the cancelled toll-free number. The judge also rejected Healy’s request for almost $19,000 in sanctions for AT&T’s violation of Mississippi Rule 37(c). That rule allows parties to recover legal expenses if they discover an opponent’s evidence is false.
The judge instead ordered $1,622.50 to cover the costs of a paralegal and associate attorney to uncover AT&T’s false statement. The law firm cited costs of $75 an hour for paralegals and $235 an hour for partner attorneys.
The judge rejected Healy’s request for his own legal fees, ruling that as the owner of his law firm, he wasn’t entitled to fees any more than if he was representing himself in court.
Healy appealed and the Mississippi Supreme Court, in a June 1 decision, upheld the nominal damages but reversed the trial court on the question of whether Healy could recover fees for his own time spent on the case.
On appeal, Healy sought $20,000 that it spent advertising the 800 number while it was disconnected.
The Mississippi Supreme Court rejected his request, saying AT&T presented evidence the ads also had the law firm’s main number, so consumers could still get through.
The judge was wrong about Healy’s fees, however, the court ruled. As a limited liability corporation, the law firm has a separate legal existence and is entitled to representation in court.
“George’s participation in this suit, in his capacity as an individual member, has no basis,” the court ruled. But as an employee of his law firm, Healy was entitled to some compensation in the sanctions award, the court concluded, sending the case back to determine that amount.