UNITED STATES DISTRICT COURT, SOUTHERN DISTRICT OF NEW YORK
January 23, 1981
Marcus BRADFORD, individually and on behalf of himself and others similarly situated, Plaintiffs,
Barbara BLUM, as Commissioner of the New York State Department of Social Services and William J. Eagen, Jr., individually and as Commissioner of the Dutchess County Department of Social Services, Defendants
The opinion of the court was delivered by: CANNELLA
Plaintiffs' motion for attorneys' fees, costs and disbursements is granted in the amount of $ 76,418.33. 42 U.S.C. § 1988; 28 U.S.C. § 1920; Fed.R.Civ.P. 54(d).
Plaintiffs commenced this class action under 42 U.S.C. § 1983 seeking to enjoin defendants from enforcing, and to declare unconstitutional, certain amendments to the New York State Department of Social Service Regulations, 18 N.Y.C.R.R. § 358.8(c)(1) (promulgated February 15, 1977), which excluded childless and employable recipients of Home Relief assistance from further payments prior to a hearing. On April 19, 1977, by order to show cause, plaintiffs moved for a temporary restraining order and a preliminary injunction. The Court issued the temporary restraining order on that date, and on April 22, 1977 conducted a hearing on plaintiffs' motion for a preliminary injunction.
On May 3, 1977, the Court granted plaintiffs' motion, finding that section 358.8, as amended, was
violative of the procedural due process requirements enunciated by the Supreme Court in Goldberg v. Kelly, 397 U.S. 254 (90 S. Ct. 1011, 25 L. Ed. 2d 287) (1970), in that it allows termination of Home Relief benefits prior to a fair hearing where issues of fact and judgment may be in controversy.
Hurley v. Toia, 432 F. Supp. 1170, 1178 (S.D.N.Y.), aff'd mem., 573 F.2d 1291 (2d Cir. 1977). On the same date, the Court determined that the suit was properly maintainable as a class action, and granted plaintiffs' motion for class certification.
Defendants appealed the Court's May 3, 1980 decision to the Court of Appeals for the Second Circuit and, while the appeal was pending, plaintiffs' attorneys moved to intervene three more named plaintiffs and to expand the size of the class. Because of the pendency of the appeal, the Court denied this motion on June 17, 1977. Plaintiffs then moved before the Court of Appeals to remand the matter to this Court so that plaintiffs' latest motion could be considered. On June 27, 1977, the Second Circuit remanded the case to this Court and, on July 8, 1977, the Court granted the motion to intervene, expanded the size of the class, and broadened the scope of the preliminary injunction accordingly. Also on July 8, 1977, the Court denied defendants' motion for a stay of the preliminary injunction pending appeal. On October 19, 1977, the Court's decision of May 3, 1977 was affirmed. Hurley v. Toia, 573 F.2d 1291 (2d Cir. 1977).
The parties then commenced trial preparation that was to last more than one year. Both sides conducted extensive discovery and plaintiffs at one point moved to compel answers to certain interrogatories. On May 10, 1978, Magistrate Sinclair, while denying plaintiffs' motion to compel, stated that defendants' "bald assertions of burdensomeness and unavailability of data are not particularly persuasive," and established a mechanism by which plaintiff could obtain the information requested. Memorandum Order at 2 (filed May 10, 1978). In July 1978, the parties entered into settlement negotiations and, on January 16, 1979, executed a stipulation of settlement, which the Court approved on March 7, 1980. At that time, the Court stated that the settlement "essentially provides the plaintiff class with the very relief sought in the complaint in this action."
Memorandum and Order at 2, 77 Civ. 1877 (S.D.N.Y. Mar. 7, 1980).
On April 8, 1980, plaintiffs filed a motion for an award of attorneys' fees, costs and disbursements. The Court conducted an evidentiary hearing on September 8, 1980, at which the six attorneys who represented plaintiffs until the approval of settlement, all of whom were employed by Mid-Hudson Legal Services, Inc. ("Mid-Hudson") when they rendered these services,
testified. Plaintiffs' attorneys on the fee application, Herbert Teitelbaum and Richard O. Berner of Teitelbaum & Hiller, P.C. ("T&H"), also testified at the hearing.
Defendants oppose the award of attorneys' fees on several grounds: (1) plaintiffs cannot be considered prevailing parties under section 1988 as to the entire award sought; (2) the time records of the Mid-Hudson attorneys are defective because they were not contemporaneously kept or adequately reconstructed; (3) the hours claimed by the Mid-Hudson attorneys are duplicative, excessive and unwarranted; (4) the hours claimed by the T&H attorneys are not compensable because these attorneys performed legal services under a contingent fee arrangement between T&H and Mid-Hudson, and because they are duplicative, excessive and unwarranted; and (5) the rates of compensation requested by plaintiffs' attorneys exceed the reasonable value of their services.
Section 2 of the Civil Rights Attorney's Fees Awards Act of 1976, 42 U.S.C. § 1988 ("section 1988"), provides in pertinent part: "In any action or proceeding to enforce a provision of (section) ... 1983 ... of this title, ... the court, in its discretion, may allow the prevailing party ... a reasonable attorneys fee as part of the costs." The Supreme Court recently removed any remaining doubt as to whether, for purposes of this section, there is a prevailing party in a class action disposed of by settlement, stating:
The fact that respondent prevailed through a settlement rather than through litigation does not weaken her claim to fees. Nothing in the language of § 1988 conditions the District Court's power to award fees on full litigation of the issues or on a judicial determination that the plaintiff's rights have been violated. Moreover, the Senate report expressly stated that "for purposes of the award of counsel fees, parties may be considered to have prevailed when they vindicate rights through a consent judgment or without formally obtaining relief." S.Rep. No. 94-1011, p. 5 (1976), U.S.Code Cong. & Admin.News 1976, p. 5908.
Maher v. Gagne, 448 U.S. 122, 100 S. Ct. 2570, 2575, 65 L. Ed. 2d 653 (1980). Defendants argue, however, that plaintiffs cannot be considered prevailing parties as to the entire award sought because they did not prevail in every aspect of the litigation. Thus, defendants claim that plaintiffs' attorneys, at best, are entitled to an award only for those hours reasonably expended "on issues on which plaintiff(s) in fact prevailed or which were necessary to (their) obtaining that status." Defendants' Post-Hearing Memorandum of Law at 6 (filed Sept. 22, 1980) ("Defendants' Memo"). Defendants point specifically to three aspects of the litigation in which they claim plaintiffs were unsuccessful: (1) plaintiffs' application for a class-wide temporary restraining order, brought on by order to show cause on April 19, 1977; (2) plaintiffs' motion in June 1977 to permit the intervention of three new named plaintiffs, to amend the prior class certification, and to expand the scope of the previously-granted preliminary injunction accordingly, prior to obtaining a remand from the Second Circuit on June 27, 1977; and (3) plaintiffs' motion to compel discovery before Magistrate Sinclair in May 1978.
For two reasons, the Court does not agree with defendants' interpretation of the phrase "prevailing party." First, the Court believes that Congress did not intend to fragment the definition of the term in the manner suggested by defendants. There is no question that in the normal course of litigation, especially complex and vigorously contested litigation such as that currently before the Court, each side will win some procedural skirmishes and lose others. Here, plaintiffs concede they did not emerge victorious in every dispute that arose during three years of litigation. But plaintiffs correctly state that they ultimately prevailed on the case as a whole, a fact acknowledged by the Court in its Memorandum and Order of March 7, 1980, approving the stipulation of settlement; indeed, the results obtained for the class were precisely those sought in the complaint. The Court agrees with plaintiffs that "(quite) simply, a plaintiff prevails if by means of his litigation he obtains from the defendant the relief he is seeking, whether or not his counsel is successful on all motions." Plaintiffs' Reply Memorandum of Law at 6 (filed Oct. 8, 1980) ("Plaintiffs' Memo").
The Court finds the reasoning of the Sixth Circuit particularly persuasive:
The question as to whether the plaintiffs have prevailed is a preliminary determination, necessary before the statute comes into play at all. Once that issue is determined in the plaintiffs' favor, they are entitled to recover attorneys' fees for "all time reasonably spent on a matter." The fact that some of that time was spent in pursuing issues on research which was ultimately unproductive, rejected by the court, or mooted by intervening events is wholly irrelevant. So long as the party has prevailed on the case as a whole the district courts are to allow compensation for hours expended on unsuccessful research or litigation, unless the positions asserted are frivolous or in bad faith. There are numerous practical reasons why a court may not be permitted to dissect a lawsuit into "issues and parts of issues as to which the plaintiffs did not prevail," especially by decimating the total hours claimed with arbitrary percentages. Suffice it to say, however, that Congress has mandated that a prevailing party's attorney should be compensated "as is traditional with attorneys compensated by a fee-paying client, for all time reasonably expended on a matter." We know of no "traditional" method of billing whereby an attorney offers a discount based upon his or her failure to prevail on "issues or parts of issues." Furthermore, it would hardly further our mandate to use the "broadest and most flexible remedies available" to us to enforce the civil rights laws if we were so directly to discourage innovative and vigorous lawyering in a changing area of the law. That mandate is best served by encouraging attorneys to take the most advantageous position on their clients' behalf that is possible in good faith.
Northcross v. Board of Education, 611 F.2d 624, 636 (6th Cir. 1979) (emphasis added), cert. denied, 477 U.S. 911, 100 S. Ct. 2999, 64 L. Ed. 2d 862 (1980).
In light of the Court's familiarity with the proceedings in this case as well as the testimony adduced at the fee application hearing, the Court finds that plaintiffs' counsel acted at all times in good faith and that on no occasion did they assert frivolous positions. See Gluck v. American Protection Industries, 619 F.2d 30, 33 (9th Cir. 1980); Gagne v. Maher, 594 F.2d 336, 340 (2d Cir. 1979), aff'd, Maher v. Gagne, supra; Mid-Hudson Legal Services, Inc. v. G & U, Inc., 578 F.2d 34, 37 (2d Cir. 1978). Of course, this finding does not mean that the Court considers that all the hours claimed were in fact reasonably expended. This issue will be considered below.
A second reason underlying the Court's rejection of defendant's argument in this area is that defendants have overstated plaintiffs' alleged lack of success in the three areas mentioned above. With respect to the temporary restraining order, the Court initially denied the class-wide relief requested, but two weeks later granted precisely that relief when it issued a preliminary injunction. Also, although it is true that the Court denied plaintiffs' motion to intervene three more named plaintiffs and to expand the class, the Court did not do so on the merits but solely because the appeal of the Court's issuance of a preliminary injunction was pending before the Second Circuit. Plaintiffs' counsel immediately sought and obtained a remand from the Second Circuit so that the Court could properly consider plaintiffs' motion. Upon remand, the Court reviewed the same papers which were prepared by counsel prior to the remand, and granted the motion in all respects. Finally, Magistrate Sinclair's denial of plaintiffs' motion to compel discovery, while not entirely favorable to plaintiffs, clearly established a mechanism by which plaintiffs could obtain substantially all of the discovery sought by that motion. Based on the Magistrate's statement that defendants' "bald assertions of burdensomeness and unavailability of data are not particularly persuasive," it seems plaintiffs' attorneys had reasonable cause for bringing the motion and they are entitled to be compensated for so doing.
Calculating the "Lodestar"
Having resolved the threshold issue of whether plaintiffs are prevailing parties, the Court must next calculate the number of hours that plaintiffs' attorneys reasonably spent on the case. The Court must then value that time as to each of the attorneys in view of their experience and skill by determining "the hourly rate normally charged for similar work for attorneys of like skill in the area." City of Detroit v. Grinnell Corp., 560 F.2d 1093, 1098 (2d Cir. 1977) ("Grinnell II "); accord, City of Detroit v. Grinnell Corp., 495 F.2d 448, 470-73 (2d Cir. 1974) ("Grinnell I"). Multiplying the hours expended by the reasonable value of the attorneys' services results in the "lodestar" figure. And "(once) this ... "lodestar' rate (is) established, other less objective factors, such as the "risk of litigation', the complexity of the issues, and the skill of the attorneys, (can) be introduced to determine a final fee amount." Grinnell II, supra, 560 F.2d at 1098.
The hours and total amounts claimed by the various attorneys are set forth below:
Mid- Hudson Legal Services, Inc.6
Attorney Claimed Per Hour Total
Bloom 167.50 $ 90 $ 15,075.00
Gorman 3.00 $ 90 270.00
Hetherington 173.25 $ 75 12,993.75
33.70 $ 90 3,033.00
461.55 $ 75 34,616.25
Kaufman 39.63 $ 90 3,566.70
53.00 $ 75 3,975.00
Kolb .50 $ 90 45.00
Lazar 65.65 $ 75 4,923.75
Totals 997.78 $ 78,498.45
Teitelbaum & Hiller, P.C.7
Berner 167.75 $ 100 $ 16,775.00
Teitelbaum 57.25 $ 125 7,156.25
Totals 225.00 $ 23,931.25
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