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NU-LIFE CONSTR. CORP. v. BOARD OF EDUC. OF NEW YOR

June 16, 1992

NU-LIFE CONSTRUCTION CORP. and TERMINATE CONTROL CORP., Plaintiffs, against BOARD OF EDUCATION OF THE CITY OF NEW YORK, DIVISION OF SCHOOL BUILDINGS OF THE BOARD OF EDUCATION OF THE CITY OF NEW YORK, STANLEY DOBROWOLSKI, JOHN TRAPANOTTO, STUART HOROWITZ, JOHN FRISONE and NICHOLAS E. BORG, Defendants.


The opinion of the court was delivered by: ARTHUR D. SPATT

 SPATT, District Judge.

 In 1986, the plaintiffs Nu-Life Construction Corp. ("Nu-Life") and Terminate Control Corp. ("Terminate") commenced this action pursuant to the Racketeer Influenced Corrupt Organizations Act ("RICO") 18 U.S.C. § 1961 et. seq. In effect, there were two separate law suits combined in this case, namely, the Nu-Life suit and the Terminate suit. In addition, the Board of Education counterclaimed against Terminate on a breach of contract claim. On March 10, 1992, after a ten-week trial, a jury returned a verdict in favor of Nu-Life on its RICO conspiracy claim in the amount of $ 23,400 against the defendants John Trapanotto and Stanley Dobrowolski. However, the jury found in favor of Trapanotto and Dobrowolski on Nu-Life's RICO § 1962(c) claims. The jury also found in favor of the defendant Nicholas E. Borg on Nu-Life's RICO conspiracy claim.

 With respect to the Terminate case, the jury returned a verdict in favor of the defendant John Frisone on Terminate's RICO § 1962(c) and conspiracy claims. A verdict was also returned for the defendant Stuart Horowitz on Terminate's RICO conspiracy claim.

 Furthermore, the jury returned a verdict for the defendant Board of Education on its counterclaim against Terminate in the amount of $ 26,800.

 At the conclusion of trial, Nu-Life moved pursuant to RICO § 1964(c) for an award of attorney's fees and disbursements incurred in connection with the prosecution of its successful claims against Trapanotto and Dobrowolski.

 Presently before the Court for determination is Nu-Life's fee application. Also, the defendant Board of Education contends that pursuant to Local Rule 11(c) it is entitled to certain deposition costs as taxable against Nu-Life. As such, it seeks to ensure that such entitlement is reflected in the judgment at the time of entry. In addition, the Board seeks the entry of final judgment as to the Terminate portion of the judgment. Finally, the defendants Trapanotto and Dobrowolski, in view of the outstanding civil rights claims still pending in this action, move pursuant to Fed. R. Civ. P. 54(b) for a direction that final judgment be entered against them as to the RICO claims, in order that they may take an immediate appeal on that part of the case.

 BACKGROUND

 Although under the "American Rule" each party in a lawsuit bears the burden of paying its own attorney's fees, certain statutes provide that a successful party may recover such fees from the adversary (see e.g., Hensley v. Eckerhart, 461 U.S. 424, 430, 76 L. Ed. 2d 40, 103 S. Ct. 1933 [1983] ["each party in a lawsuit ordinarily shall bear its own attorney's fees unless there is express statutory authorization to the contrary"]; Alyeska Pipeline Service Co. v. Wilderness Soc., 421 U.S. 240, 44 L. Ed. 2d 141, 95 S. Ct. 1612 [1975]).

 Section 1964(c) of RICO provides such statutory authorization to shift the cost of attorney's fees, as follows:

 "any person injured in his business or property by reason of a violation of section 1962 of the this chapter may sue therefor in any appropriate United States district court and shall recover threefold the damages he sustains and the cost of the suit, including reasonable attorney's fees" (emphasis supplied).

 The defendants Trapanotto and Dobrowolski object to Nu-Life's fee application on the grounds that it fails to supply contemporaneous billing records in sufficient detail so that they can determine which fees sought are attributable to Nu-Life's successful claims against them. In particular, they contend that much of the time spent by Nu-Life at trial and in defending a summary judgment motion made by the Corporation Counsel on behalf of several other defendants is not compensable under the RICO fee-shifting provision. They contend that the legal services rendered by plaintiffs' counsel in opposition to the motion was on behalf of a plaintiff that did not ultimately succeed in the litigation. They object to all but $ 92,212.75 of the fees sought by Nu-Life. Additionally, they suggest that this lesser figure should be further be reduced by a factor of 25 per cent, resulting in a net fee award of $ 69,159.56.

 DISCUSSION

 a. Attorney's Fees Under RICO

 The fee award provision contained in section 1964(c) of RICO parallels that of section 4 of the Clayton Act, 15 U.S.C. § 15 (see Aetna Cas. & Sur. Co. v. Leibowitz, 730 F.2d 905, 907 [2d Cir. 1984]). The thrust of each provision is that any person injured in his business or property by reason of a violation of the respective law, either the antitrust laws or RICO, "shall recover . . . the cost of the suit, including a reasonable attorney's fee" (15 U.S.C. § 15[b]; 18 U.S.C. § 1964[c]).

 What constitutes a reasonable attorney's fee under the Clayton Act is first determined by multiplying all reasonable hours expended by the successful party's attorney by a reasonable hourly billable rate (see U.S. Football League v. National Football League, 887 F.2d 408, 413 [2d Cir. 1989] cert. denied 493 U.S. 1071, 107 L. Ed. 2d 1022, 110 S. Ct. 1116 [1990]). The product of these figures is often referred to as the "lodestar," which may be subject to further adjustment depending on other factors that a Court may take into consideration when calculating an award of attorney's fees (see e.g., U.S. Football League, supra, at p. 415 [citing factors]; see also Burr v. Sobol, 748 F. Supp. 97, 99-100 [S.D.N.Y. 1990]). For example, in Hensley v. Eckerhart, supra, at p. 435, the United States supreme Court suggested that a reduction to the lodestar may be appropriate "where the documentation of hours is inadequate."

 b. Arriving at the Lodestar

 Central to an application for attorney's fees is the submission of time records reflecting the hours expended by the attorney in pursuing the successful claims of his client. In this circuit, in order for a party to recover attorney's fees, such time records must be made contemporaneously with the associated work (see Lewis v. Coughlin, 801 F.2d 570, 577 [2d Cir. 1986]). Furthermore, "these records should specify, for each attorney, the date, the hours expended, and the nature of the work done" ( New York State Ass'n for Retarded Children, Inc. v. Carey, 711 F.2d 1136, 1148 [2d Cir. 1983]). As a general rule, only the time expended on the plaintiff's successful claims is to be considered in arriving at a fee award (see Cowan v. Prudential Ins. Co. of America, 935 F.2d 522, 524 [2d Cir. 1991]; see ...


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