The opinion of the court was delivered by: TENNEY
Pending before this Court is plaintiffs' motion for attorneys' fees under the Civil Rights Attorneys' Fees Awards Act of 1976, 42 U.S.C. § 1988 (1982) ("§ 1988"). The underlying case is a class action
that challenged the constitutionality of certain rental practices in five housing developments in the Williamsburg area of Brooklyn, New York. The suit resulted in a Consent Decree, developed by the parties in conjunction with various community groups, which provided a comprehensive plan for preventing and remedying the civil rights violations found by this Court.
The defendants in the instant motion are Kraus Management, Inc. and Ross-Rodney Housing Corp., the manager and owner, respectively, of the Bedford Gardens housing development ("Bedford Gardens defendants.") Plaintiffs request payment of attorneys' fees for sevices rendered by five attorneys over a period fo four-and-a-half years, 1976 to 1981, totalling 2,758.50 hours. The attorneys for plaintiffs are the Puerto Rican Legal Defense and Education Fund, Community Action for Legal Services, and Teitelbaum & Hiller, P.C.
Plaintiffs seek a total award of $465,126.33. They request that the award be based on hourly rates ranging from $50 to $125, and that a multiplier of 2.5 be employed. Plaintiffs also seek compensation for the time spent on this application for attorneys' fees, as well as costs and disbursements.
Based on the reasoning set forth below, the Beford Gardens defendants are ordered to pay a total of $216,880.70. This award has several components. First, the fees incurred from 1976 to 1981 were determined by multiplying a reasonable hourly rate by the number of hours reasonably expended in litigation against the Bedford Gardens defendants, which produced a basic fee of $137,507.50. Next, that amount was increased by a multiplier of 1.25 because of the contingent nature of the case; the adjusted figure is $171,884.37.Finally, the compensation awarded for the time spent on this application for attorneys' fees, $37,732.50, was added to that figure, together with $7,263.83 for out-of-pocket costs, resulting in a total award of $216,880.70. In addition, interest is to be paid on that sum, calculated from August 23, 1983, the date that this Court entered judgment granting plaintiffs' request for attorneys' fees.
In 1976 the plaintiffs sued New York City Housing Authority ("NYCHA") and its chairman who were responsible for four housing developments in the Williamsburg area. Plaintifs subsequenlty added the Bedford Gardens defendants.
After the case was commenced, the United Jewish Organization as Williamsburg ("UJO") intervened as a defendant, together with individuals seeking to protect the interests of all white families that had existing leases at Bedford Gardens. The UJO and one individual also began a third-party action against the owner and manager of a sixth housing development in the area, the Roberto Clemente Plaza ("Clemente") and against certain federal and local authorities involved in Clemente's operation.
The testimony and evidence in the case showed that rental quotas based on race and ethnic origin had been developed and instituted at each of the housing developments named in the suit. The Bedford Gardens defendants maintained a quota of 75% white families, 20% hispanic and 5% black families. Clemente's quota was the opposite of the quota at Bedford Gardens. At Clemente 75% of the apartments were to be rented to non-white families and 25% to white families.The plaintiffs in the original action sought to protect the existing leases of non-white families at Clemente and threefore actively participated in the third-party action concerning Clemente. In 1978, all parties, except the Bedford Gardens defendants, subscribed to the Consent Decree.
Shortly before the Consent Decree was approved, the plaintiffs settled with NYCHA and its chairman and two of the third-party defendants. In that settlement, plaintifs received attorneys' fees of $59,687.00 together with costs of $7,527.26.
The plaintiffs' claims were strenously contested by the Bedford Gardens defendants, who refused to negotiate with the other parties and would not accept the terms of the Consent Decree. After a hearing and a careful review of the evidence, the Court issued an injunction ordering the Bedford Gardens defendants to act pursuant to the terms of the Consent Decree. 493 F. Supp. 1225 (S.D.N.Y. 1980). The Bedford Gardens defendants appealed that injunction; the court of appeals held that the injunction would remain in effect unless the defendants agreed to subscribe to the Consent Decree.Summary Order, No. 80-6161 (2d Cir. Jan. 22, 1981). In January 1981, the Bedford Gardens defendants finally subscribed to the Decree and the litigation was thus resolved.
Plaintiffs now move against the Bedford Gardens defendants for payment of their attorneys' fees pursuant to § 1988 which provides that federal courts may award attorneys' fees to prevailing parties in civil rights cases.
Although the Bedford Gardens defendants concede that the plaintiffs are entitled to attorneys' fees as the prevailing party under § 1988,
they object to the number of hours claimed, the hourly rates requested and the proposed upward adjustment. The Bedford Gardens defendants argue that they should not bear sole responsibility for the fees incurred; they contend that responsibility should be allocated among all defendants and third-party defendants and, further, that no attorneys' fees should be awarded for the time spent on the 1980 appeal. In sum, although the Bedford Gardens defendants concede that an award of attorneys' fees is warranted, they disagree with the plaintiffs concerning the appropriate amount of the award; the plaintiffs contend that the Court should award more than $450,000, while the defendants contend that the award should be less than $20,000.00.
Because plaintiffs are the prevailing parties under § 1988, they are entitled to an award of reasonable attorneys' fees. The legislative history indicates that reasonable fees are those "which are adequate to attract competent counsel, but which do not produce windfalls to attorneys." S. Rep. No. 1011, 94th Cong., 2d Sess. 6, reprinted in 1976 U.S. Code Cong. & Ad. News 5908, 5913 ("Senate Report").Such fees are normally based on the number of hours that counsel reasonably expended on the case, multiplied by a reasonable hourly rate. Blum v. Stenson, 461 U.S. 424, 103 S. Ct. 1933, 76 L. Ed. 2d 40 (1983)). The resulting amount is commonly known as the "lodestar" figure. See City of Detroit v. Grinnell Corp., 560 F.2d 1093, 1098 (2d Cir. 1977).
Because there were multiple parties in the underlying action, it is necessary for the Court to address the question of the proper allocation of responsibility for fees incurred by plaintiffs. After addressing this issue, the Court will consider what constitutes a reasonable hourly rate in the instant matter, and whether the number of hours claimed by plaintiffs' attorneys is reasonable.
A) Allocating Responsibility for Attorneys' Fees
Plaintiffs seek attorneys' fees for services rendered from 1976 to 1981, amounting to 2,780.50 hours. From 1978 to 1981, the Bedford Gardens defendants were the only defendants involved in the litigation, since all other parties had subscribed to the Consent Decree in 1978. As the sole defendants, the Bedford Garden defendants are responsible for all attorneys' fees arising out of the litigation after 1978.
From 1976 to 1978, however, there were numerous parties involved in the litigation. Nevertheless, plaintiffs argue that the Bedford Gardens defendants were the "primary defendants," and therefore should pay the entire 1976-1978 lodestar figure requested, amounting to $153,987.50, or at least pay the "lion's share." The Court finds that this argument is not persuasive and that an equitable apportionment of the responsibility for the 1976-1978 fees is necessary. The Court has made a careful and lengthy examination of the record in this case, and after much deliberation finds that the Bedford Gardens defendants should pay 40% of the attorneys' fees incurred from 1976 to 1978.
Where there are multiple defendants, each defendant must bear the prevailing plaintiff's fees for time spent on matters clearly related to the claims made against that defendant.See Arkansas Community Org. v. Arkansas State Bd., 468 F. Supp. 1254, 1258-59 (E.D. Ark. 1979); accord Ingram v. Madison Square Garden Center, Inc., 482 F. Supp. 918, 928 (S.D.N.Y. 1979).
In the instant case, the legal and factual issues raised by the plaintiffs' claims against the various defendants and third-party defendants were so interrelated that it is impossible to isolate the number of hours spent litigating against any one party. Thus, much of the time expended by the plaintiffs' attorneys on claims relating to the parties other than the Bedford Gardens defendants had a direct impact on the claims made against the Bedford Garden defendants. The 1976 hearings concerning the rental policies at Clemente, for example, produced evidence concerning the rental practices throughout the Williamsburg community, as well as evidence showing that the quotas developed at Clemente had been developed to counterbalance the quotas developed at Bedford Gardens. In addition, the Consent Decree, which provided the ultimate remedy in the plaintiffs' suit against the Bedford Gardens defendants, would not have been developed without the long, intense negotiations undertaken by the plaintiffs' attorneys with the other parties.
Because the issues were so interrelated, plaintiffs suggest that responsibility for attorneys' fees be allocated based on "the principal purpose of the suit and the primary and controlling matter in dispute." See Plaintiffs' Reply Memo. at 8. The Court agrees that an examination of the basic issues involved in the litigation is the best procedure.
The Bedford Gardens defendants contend that there were two fundamental disputes -- one involving the Bedford Gardens housing development and the other involving the Clemente apartments. See Defendants' Supplemental Memo. In Opposition at 12. Analyzing the case in this manner would result in holding the Bedford Gardens defendants responsible for one-half of the plaintiffs' attorneys' fees.
Such allocation, however, would ignore the claims made against NYCHA concerning the four other housing developments in the area. In light of such claims, the case could be characterized as involving three, rather than two, primary disputes. Without more, such characterization would lead to holding the Bedford Gardens defendants liable for only one-third of the fees incurred.
Based on a review of the record, however, the Court finds that the Bedford Gardens defendants should bear responnsibility for 40% of the fees incurred, rather than one-half or one-third. Because of the claims made against NYCHA, it would be inequitable to require that the Bedford Gardens defendants pay 50% of the fees involved. It would also be inequitable to divide responsibility in three equal parts since the claims made concerning Bedford Gardens and Clemente were more time ...