UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NEW YORK
October 8, 1998
NEW LEADERSHIP COMMITTEE, et al., Plaintiffs, against WILLIAM DAVIDSON et al., Defendants.
The opinion of the court was delivered by: GERSHON
MEMORANDUM & ORDER
GERSHON, United States District Judge:
The plaintiffs, all members of the Flushing New York Local of the American Postal Workers Union ("Local"), moved by order to show cause, dated April 28, 1997, for a preliminary injunction against certain Local officers and appointed members of the election committee of the Local. Plaintiffs alleged nine claims based on violations of the Labor Management Reporting and Disclosure Act ("LMRDA"), 29 U.S.C. §§ 411(a)(1), (2), (5), and 431(c), and the Labor Management Relations Act ("LMRA"), 29 U.S.C. § 185, in connection with an alleged scheme by defendants to suppress dissent within the Local. Prior to and during the course of an evidentiary hearing before the Honorable Cheryl L. Pollak, Magistrate Judge, to whom the matter had been referred, the parties agreed to settle some of the claims. On May 16, 1997, following completion of the hearing, which by agreement addressed only claims four and five, Magistrate Judge Pollak issued a Report recommending the granting of relief to plaintiffs on these claims. On May 19, 1997, the parties entered into a stipulation, in which the defendants agreed to provide the relief recommended by Magistrate Judge Pollak and settled as well the remaining claims. The issue of attorneys' fees was referred to Magistrate Judge Pollak.
I have reviewed the comprehensive Report of Magistrate Judge Pollak, dated December 5, 1997, the Supplemental Declaration of Adrienne L. Saldana, Esq., filed in accordance with the Report, defendants' objections to the Report, plaintiffs' response to those objections, defendants' reply to plaintiffs' response, the Declaration of Adrienne L. Saldana, Esq., requesting additional attorneys' fees of $ 1650 incurred in responding to defendants' objections to the Report, and the Supplemental Report, dated March 13, 1998, to which no objections have been filed.
Defendants contend that the Magistrate Judge erred in concluding that the litigation commenced by plaintiffs was a catalyst for the benefits received by the class of beneficiaries under the common benefit theory of attorneys' fees; that she erred in concluding that the benefits received by the plaintiffs were proportionate to those received by the class; and that she erred in concluding that this litigation conferred substantial and not speculative benefits upon the class. Magistrate Judge Pollak's report thoroughly and accurately addresses each of these arguments. As she stated:
Each of the provisions of the settlement in this case generally benefitted the union membership by reaffirming the commitment that union affairs would be conducted in accordance with established procedures; that union elections would be conducted in a fair and informed manner; and that dissenting union members would not be subjected to disciplinary action or retaliation for exercising their rights to free speech. Thus, while defendants attempt to minimize the significance of the agreement to abide by Robert's Rules of Order, the allegations in the complaint and the testimony presented to this Court suggest that a reminder of their obligation to comply was necessary. Similarly, to the extent that the lifting of the disciplinary charges against plaintiff McGrath conferred a substantial personal benefit on him, it also dispelled whatever "chill" that had resulted from the discipline upon the free speech rights of all Local members. Finally, while Ms. Kim's reinstatement to the ballot conferred an obvious personal benefit upon her, in fact, the most important right affected by her reinstatement was the right of those members who wished to vote for her. The fact that she ultimately did not prevail in the election is utterly irrelevant.
Report, p. 10; see also Report, p. 11, n. 4.
The magistrate judge also correctly concluded that the absence of a judgment was not a bar to an award of attorneys' fees. Indeed, the settlement of the fourth and fifth claims, which were the subject of the evidentiary hearing before Magistrate Judge Pollak, effectively adopted her Report dated May 16, 1997, and it was for that reason that no determination on the merits, or judgment, was issued by this court. The law favors settlements. The plaintiffs were required to litigate the issues, and the defendants agreed to provide the relief requested only after the issuance of a formal Report of a United States Magistrate Judge recommending that the relief be awarded. As Magistrate Judge Pollak found, there can be no question about the litigation's causal effect on the defendants' conduct.
As to the rates awarded, Magistrate Judge Pollak found that the rates requested, $ 275 for the partner, $ 200 for a highly experienced associate, $ 150 for a less-experienced associate and $ 65 for each of two law students, were reasonable. Magistrate Judge Pollak noted that the parties had not submitted, and she had not found, any Eastern District cases suggesting that plaintiffs' counsels' rates "are not within the range of prevailing rates for attorneys engaged in this type of practice in the Eastern District. Indeed, even if the prevailing rate was lower in this district, the rates charged by plaintiffs' counsel here are in fact somewhat lower [than] the rates used to calculate fees in the Southern District." Report, p. 12.
Defendants now submit the affidavits of two labor lawyers who practice in the Eastern District of New York who do not opine on "prevailing" rates in the community, but state what their rates are. Thus, the affidavit of Daniel T. Campbell, Esq., states that he has an office in Floral Park, New York, for the practice of "employment law" and that, with respect to employment law litigation, in which he is experienced, his "customary hourly rate is $ 250." The affidavit of Thomas J. Lilly, Esq., of Garden City, New York, states that the fees his firm charges a union it is now representing (which are, he states, typical of his firm's fees), are $ 210 for a senior litigation partner, $ 190 for a junior litigation partner, and $ 150 for associates.
To begin with, the defendants had a full opportunity to present such evidence to the magistrate judge, but failed to do so. De novo review must include only an examination of the record accumulated before the magistrate judge; it need not afford the parties at this late stage an opportunity for a new evidentiary hearing. See, e.g., Gwen Sportswear, Inc. v. State Mutual Life Assurance Co. of America, 1991 U.S. Dist. LEXIS 9165, *4, 1991 WL 130892, *1 (S.D.N.Y.). I therefore decline to consider the additional affidavits submitted by the defendants. Even if considered, as the additional affidavits merely state the rates of two firms and do not address the broader issue of prevailing rates in the community, they would be insufficient to establish that Magistrate Judge Pollak had erred in any way.
Defendants also argue that the magistrate judge erred in considering the rates of attorneys from the Southern District of New York. They suggest that Luciano v. Olsten Corp., 109 F.3d 111, 115 (2d Cir. 1997) forbids the court, in its broad discretion to set reasonable attorneys' fees, from taking into account attorneys' rates from districts other than the one in which the court sits. In Luciano, the trial judge, Judge Spatt, had refused to apply the prevailing rates in the Southern District of New York in awarding attorneys' fees to a Manhattan-based lawyer in an action litigated in the federal courthouse at Uniondale on Long Island. Luciano v. Olsten Corp., 925 F. Supp. 956 (E.D.N.Y. 1996). The Court of Appeals for the Second Circuit affirmed the court's use of its "broad discretion" to set reasonable attorneys' fees and stated that, "because this action was commenced and litigated in the Eastern District of New York, the district court's reliance on these rates [of the Eastern District] was proper." Luciano, 109 F.3d at 115-16.
Defendants overstate the holding of Luciano if they read it to mean that Southern District of New York rates can never be considered in fixing rates in the Eastern District of New York. Because they divide New York City, the Eastern and Southern Districts of New York are unique districts, and many New York City lawyers practice in two separate federal jurisdictions within the same city. The division of what is now New York City into two separate districts occurred in 1865 at a time when "Brooklyn was a separate city with no physical links to New York City--a municipality then consisting only of Manhattan Island." United States v. Hart-Williams, 967 F. Supp. 73, 79 (E.D.N.Y. 1997) (citation omitted). Though in a different context, Judge Korman's comments in Hart-Williams, are equally apt here:
Of course today, Brooklyn and Manhattan are integral parts of a single city, linked to one another and the remainder of the city's boroughs by numerous bridges, tunnels, and highways. Indeed, it is possible to walk from the United States Courthouse in Brooklyn, across the Brooklyn Bridge, to the United States Courthouse in Manhattan.
Id. Congress has recognized the uniqueness of the Eastern and Southern Districts of New York by allowing an exception from the normal district residence requirement for U.S. Attorneys and federal district judges in these districts, an exception which allows United States Attorneys and district judges to reside in one district and work in the other. See 28 U.S.C. § 545(a) (U.S. Attorneys); 28 U.S.C. § 134(b) (district court judges). And the district judges of the two districts have recognized the unique circumstances facing New York City lawyers in adopting a single set of Local Rules applicable, with limited exceptions, in both districts.
Polk v. New York State Dept. of Corr. Services, 722 F.2d 23 (2d Cir. 1983), upon which the Second Circuit relied in Luciano, recognized the importance of not creating incentives for lawyers to bring cases in districts with higher attorneys' fees for the sole purpose of attaining heightened fees. Polk, 722 F.2d at 25. On the other hand, although the "American Rule" bars the recovery of attorneys' fees in general, those statutes or theories under which attorneys' fees can be shifted are based upon the policy of encouraging lawsuits to vindicate important rights that otherwise might not be vindicated. See, e.g., Rodonich v. Senyshyn, 52 F.3d 28, 32-33 (2d Cir. 1995). With this in mind, the Second Circuit's Luciano decision should not be read so strictly as to create an unreasonable disincentive for Manhattan-based attorneys to bring such suits in Brooklyn. Indeed, in Polk, although not in the New York City context, the Second Circuit reversed the district court's exclusive reliance on the lower rates in the Northern District of New York, under circumstances where the facts indicated that the court could also have considered Southern District rates. Polk, 722 F.2d at 25. As stated in Polk, "district judges retain broad discretion in determining 'reasonable' attorney's fees," and "the rate prevailing in the appropriate community is only one of many factors bearing on determination of a fee award." Id.
This is not to say that a single rate should prevail across the board in New York City. But it is to recognize that, in determining prevailing rates for suits brought in this Courthouse, it is not necessarily improper to consider what is occurring minutes away across the East River. In sum, it is within the court's broad discretion to consider the unique circumstance of lawyers in New York City who practice in two different federal jurisdictions within the same city. The magistrate judge therefore did not abuse her discretion to establish reasonable attorneys' fees by taking into account the rates charged by lawyers practicing in the Southern District of New York.
Defendants also contend that the $ 503.75 in fees for students should be omitted from the fee award. They note that the magistrate judge did not cite any authority for including law students within her award of attorneys' fees. Undoubtedly that is because it is so well established that, so long as the rates charged and hours spent are reasonable, fees for students are recoverable. See, e.g., Jones v. Kreisel Company, Inc., 1995 U.S. Dist. LEXIS 17044, *4-5, 1995 WL 681095, *2 (S.D.N.Y); Burr v. Sobol, 748 F. Supp. 97, 100 (S.D.N.Y. 1990).
Finally, plaintiffs are awarded costs of $ 652. Plaintiffs have amply supported an award of $ 440 for process servers, $ 212 for photocopies, and $ 150 for the filing fee. Defendants' objection to these awards, that the magistrate judge did not provide any "explanation or precedent" for allowing plaintiffs to submit additional proof respecting these costs within 14 days of her Report, is frivolous. The issue of attorneys' fees and costs was referred to the magistrate judge. That referral provided her with authority to exercise her discretion as to the procedures to be followed. Allowing further documentation to be submitted was not an abuse of her discretion.
The Report of December 5, 1997 and the Supplemental Report dated March 13, 1998, are adopted. Plaintiffs are awarded $ 56,636.25 in attorneys' fees and $ 802 in costs.
United States District Judge
Dated: Brooklyn, New York
October 8, 1998
© 1992-2004 VersusLaw Inc.