The opinion of the court was delivered by: CHARLES HAIGHT, District Judge
MEMORANDUM OPINION AND ORDER
Plaintiff Lee N. Koehler objects in part to the Report and
Recommendation of Magistrate Judge Michael H. Dolinger dated January 12,
2004 (the "January 12th Report"). Specifically, Koehler objects to
Judge Dolinger's use of historical billing rates in calculating
attorneys' fees to be awarded plaintiff against defendant The Bank of
Bermuda ("BBL"). For the reasons stated below, Koehler's objection is
sustained, and the fee award recommended by Judge Dolinger will be
This application for attorneys' fees arises out of a long-standing
post-judgment garnishment proceeding between Koehler and the Bank of
Bermuda, Ltd. ("BBL"). See Koehler v. Bank of Bermuda, Ltd., No.
M18-302, 2004 WL 444101 (S.D.N.Y. Mar. 10, 2004). The facts of that case
need not be recited here. It is sufficient for present purposes to note
that one of the many speed bumps along the road of this tangled
litigation stemmed from a lengthy discovery dispute between the parties.
As Judge Dolinger has held, BBL's "multiple defaults" and a "pattern of
inactivity" with respect to compliance with discovery orders had
"probably impacted adversely . . . the ability of Koehler to unearth all
reasonably pertinent information about the extent of the Bank's contacts
with New York in or about 1992 and 1993." Koehler v. Bank of Bermuda, Ltd., No. M18-302, 931745, 2003 WL 289640, at *3, *12 (S.D.N.Y.
Feb. 11, 2003). As a result of these failings, Judge Dolinger required
BBL to pay "the reasonable expenses arising out of Koehler's motions to
compel and for sanctions and his supplemental motion for sanctions." Id.
at *16. The amount of the award was to be determined at a future date.
That date came on January 12, 2004, when Judge Dolinger recommended an
award to Koehler of $33,025.57 in fees and expenses. January 12th
Report at 18. Koehler now objects to only one part of Judge Dolinger's
decision, in which in the course of determining attorneys' fees, he
calculated the hourly rate of Koehler's outside counsel based on historic
rather than current rates, which are materially higher. Koehler submits
that attorneys' fees should have been calculated based on the current
rate of $250 an hour, which would increase his total award to
As I have previously recognized, Judge Dolinger's rulings on fee awards
are nondispositive orders under Rule 72(a), Fed.R. Civ. P., which, as
specified by the Rule, may be modified or set aside only if "clearly
erroneous or contrary to law." Order of Aug. 11, 2003 at 4. They should
only be reversed upon a finding of abuse of discretion. See Nikkal
Indus., Ltd. v. Salton, Inc., 689 F. Supp. 187, 189 (S.D.N.Y. 1988).
Judge Dolinger's award of attorneys' fees involved the calculation of
the "lodestar" figure, a conventional method by which the number of hours
reasonably expended on the litigation is multiplied by a reasonable
hourly rate for attorneys and paraprofessionals. January 12th Report at
5. In his initial affidavit in support of legal fees and expenses,
Koheler, who is an attorney, requested that Judge Dolinger determine the
award based upon the following hourly rates for Koehler and his law
partners, Paul L. Newhouse and Brian G. West:
Lee N. Koehler $175.00 per hour Paul F. Newhouse
$100.00 per hour Brian G. West $150.00 per hour (1997 rate)
165.00 per hour (1998 rate)
175.00 per hour (2001 rate)
195.00 per hour (2003 rate)
Aff. of Lee N. Koehler, Paul F. Newhouse and Brian G. West in Supp.
of Submission of Legal Fees and Expenses per Order of Feb. 10, 2003 at
¶ 5 (Mar. 19, 2003) (the "Koehler Affidavit").
Plaintiff averred that the rates reflected hourly rates charged to
other clients at the time the legal services in this case were actually
rendered (hence the term "historic rates"), or, with respect to
Newhouse, were well below hourly rates charged to other of his clients.
Id. at ¶ 6.
BBL disputed that portion of Koehler's application of attorneys fees
arising out of his own activities. BBL argued that since a pro se party
may not obtain an award of attorney's fees, legal services performed by
Koehler on his own behalf should be excluded from the calculation of the
award. See Mem. of Resp't, the Bank of Bermuda Ltd., in Resp. to Pet'r
Submission Regarding Legal Fees and Expenses at 2-3 (Mar. 27, 2003)
("Mar. 27 Response Brief").*fn1
However, as a partial response to BBL's argument, Koehler changed his
position with respect to the hourly rates used. Abandoning the position
that historic rates should be used, Koehler revised his request and asked
that Newhouse's and West's time should be compensated at a current rate
of $250.00 per hour, in order to reflect both a delay in payment as well
as an adjustment for the relevant market area. Mem. in Reply to Resp't
Resp. to Pet'r Submission at 8-10 (Apr. 30, 2003).
In his Report and Recommendation, Judge Dolinger calculated Koehler's
award based on historic rather than current rates. See January 12th
Report at 14 ("[D]espite the fact that rates used in calculating a fee
award should be current rather than historic, Mr. West has requested compensation at the rates actually billed to other clients at the
time the relevant work was performed." (citations omitted)). I must now
decide whether this decision was an abuse of discretion.
The party seeking a fee award bears the burden of demonstrating that
the hourly rates they seek are "in line with those prevailing in the
community for similar services by lawyers of reasonably comparable
skill, experience, and reputation." Blum v. Stenson, 564 U.S. 886, 896
n.11 (1984). The relevant "community" is "the district in which the court
sits," which in this case is the Southern District of New York. Polk v.
New York State Dep't of Corr. Servs., 722 F.2d 23, 25 (2d Cir. 1983),
Here, plaintiff has demonstrated that $250 per hour is a reasonable
current rate for attorney's fees.
Plaintiff cites several cases which indicate that $250 per hour is well
in line with hourly rates allowed for attorneys with similar years of
experience in small law firms within the S.D.N.Y. market. See Pet'r
Objection to Report and Recommendations of Mag. Judge at 3-4 (Jan. 19,
2004). In fact, Judge Dolinger notes that Mr. West's request for
historical fees (ranging from $150 to $195 per hour) "are well below the
current hourly fees that have been awarded to solo practitioners and
small-firm attorneys of comparable experience in this district." January
12th Report at 14-15. Based on the foregoing, I find that $250 per hour
is a reasonable hourly rate based on current fees.
However, that does not end the inquiry. What remains to be determined
is whether Judge Dolinger application of historical rather than current
rates in calculating attorneys' fees was an abuse of discretion.
Prior to 1989, the practice in this circuit in calculating the lodestar
figure had been to apply the historic rate or, in the case or protracted
litigation, to divide the litigation into two separate periods and apply the current rate to the more recent period and
the historic rate to the former. See Grant v. Martinez, 973 F.2d 96, 100
(2d Cir. 1992) (describing the prior practice). However, in 1989 the
Supreme Court held in Missouri v. Jenkins, 491 U.S. 274 (1989) that "an
appropriate adjustment for delay in payment whether by the application
of current rather than historic hourly rates or otherwise is within the
contemplation of the statute." Id. at 284. In accordance with that
important decision, this circuit no longer mandated the ...