Calling the fee request “offensive on its face,” the U.S. District Court for the Central District of California objected to awarding attorney fees that exceeded the $500,000 received by the plaintiffs in the settlement. Upon examining the fee request, the district court reduced the hourly rates specified by the attorneys by 25 percent, and the court further reduced the hours claimed based on the “ambiguous” billing format used and for numerous problems with billing entries. After making these reductions, the district court awarded $473,138 in attorney fees.
Attorney Fees Not Governed by Plaintiffs’ Recovery
The Ninth Circuit vacated the award, finding that the district court failed to adequately explain why it so greatly reduced the attorney fees. Because the district court exceeded its discretion, the Ninth Circuit remanded the matter for a recalculation of the fee award.
The Ninth Circuit noted that the district court appeared “deeply concerned” that the plaintiffs’ attorneys requested “more than double” the fees of the monetary settlement received by the plaintiffs. But it would be an error for the district court to reduce the fee award solely because of this concern, the Ninth Circuit stated. The plaintiffs in civil rights cases often receive “non-monetary benefits,” such as the end of abusive practices and clarity about constitutional standards. Thus, it is permissible for attorneys to receive fees that are greater than the monetary awards obtained by their clients.
The Ninth Circuit also pointed out there were several reductions made by the district court that required more explanation. For example, the appellate court concluded that the district court did not rely on “evidence of prevailing market rates” to determine whether the attorneys’ hourly rates were reasonable. It also analyzed the difference between small cuts and large ones, noting that a court may apply a “haircut” to the hours billed and reduce them by 10 percent without providing a detailed explanation, but must “provide a clear and concise explanation to justify” larger across-the-board reductions.
The Ninth Circuit further reiterated that 42 U.S.C. § 1988 permits attorneys to receive fees for the “time spent in preparing fee applications,” often called “fees on fees.” Accordingly, the Ninth Circuit instructed the district court to reconsider whether the attorneys were entitled to such fees.
Civil Rights Cases Different from Commercial Cases
Gonzalez shows that “not every case can be looked at on a commercial basis,” says Edward M. Mullins, Miami, FL, cochair of the ABA Section of Litigation’s Access to Justice Committee. “Civil rights cases are concerned with making laws and vindicating rights,” so it is inappropriate to simply apply a “cost-benefit analysis” when determining attorney fees, Mullins contends.
Filing an Effective Fee Application
This case also “highlights the difficult problem district courts have when faced with lengthy and complicated fee applications,” says Richard A. Derevan, Costa Mesa, CA, Ninth Circuit Editor for the Section of Litigation’s Appellate Practice Committee. Attorneys can file more effective fee applications if they “segregate by task as opposed to” simply using chronological billing, Derevan suggests. “It is important to break out your time and not use block billing,” agrees Mullins. “This makes it easier for the court” to review fee applications, he notes.
Attorneys can also assist the judge by “giving fuller explanations of problems they encountered and explain why such things took longer than the judge might expect,” Derevan says. It is important that attorneys “be reasonable. Don’t be afraid to say we’re not going to ask for all of the time we spent on this matter,” Mullins recommends. Further, if your fee request is more than the settlement amount, you need to be “very careful that it doesn’t appear that you are taking advantage of the case and to explain why your request is reasonable,” he says.
Sara E. Costello is an associate editor for Litigation News.