Plaintiffs-Appellants appeal from an order of the United States District Court for the Northern District of New York (Sharpe, J.), approving the settlement of a class action arising from alleged violations of their constitutional rights, but awarding less than the requested fee to their attorneys.
We conclude that the district court did not abuse its discretion by declining to award attorneys' fees using a percentage-of-fund approach, in the extent of its reliance on our decision in Arbor Hill Concerned Citizens Neighborhood Association v. County of Albany,
The opinion of the court was delivered by: Livingston, Circuit Judge
Before: WALKER, LIVINGSTON, Circuit Judges, KAPLAN,*fn1 District Judge.
Plaintiffs-Appellants appeal from an order of the United States District Court for the Northern District of New York (Sharpe, J.), approving the settlement of a class action arising from alleged violations of the their constitutional rights, but awarding less than the requested fee to their attorneys from the common fund established by the settlement. Rather than base its attorneys' fees calculation on a percentage of the fund, the district court elected to calculate fees using a variant of the lodestar method described by this Court in Arbor Hill Concerned Citizens Neighborhood Association v. County of Albany, 493 F.3d 110 (2d Cir. 2007), superseded by 522 F.3d 182 (2d Cir. 2008). Considering the factors set forth in Goldberger v. Integrated Resources, Inc., 209 F.3d 43 (2d Cir. 2000), the district court concluded that counsel were adequately compensated by an award of fees that reflected their normal hourly rates. Because we conclude that the district court did not abuse its discretion in making these determinations, we affirm.
On October 19, 2001, this Court issued its decision in Shain v. Ellison, 273 F.3d 56 (2d Cir. 2001), in which it determined, relying on its previous decisions in Wachtler v. County of Herkimer, 35 F.3d 77 (2d Cir. 1994), Walsh v. Franco, 849 F.2d 66 (2d Cir. 1988), and Weber v. Dell, 804 F.2d 796 (2d Cir. 1986), that it was clearly established that a corrections officer may not perform a strip search of a pre-trial detainee charged only with a misdemeanor absent an individualized, reasonable suspicion that the detainee possesses contraband or weapons. See Shain, 273 F.3d at 59. In the wake of this decision, a number of lawsuits challenging strip search policies were commenced throughout New York State. See, e.g., Complaint, McBean v. City of New York, No. 02-cv-5426 (S.D.N.Y. July 15, 2002); Complaint, Kelsey v. Schoharie County, New York, No. 1:04-cv-00299 (N.D.N.Y. Mar. 19, 2004); Complaint, Pritchard v. County of Erie, No. 04 cv 0534 (W.D.N.Y. July 21, 2004).
On June 29, 2004, Appellants Nichole Marie McDaniel and Lessie Lee Davies filed a complaint in the United States District Court for the Northern District of New York on behalf of themselves and others similarly situated, asserting that the Schenectady County Sheriff's Department maintained a policy, implemented by senior officers including Appellees Harry Buffardi, Gordon Pollard, and Robert Elwell, of strip-searching all individuals who were incarcerated at the Schenectady County Jail and placed in jail clothing, regardless of the crime with which they were charged. The complaint sought compensatory and punitive damages, as well as declaratory and injunctive relief. The parties vigorously litigated this action for a period of more than three years, with various attorneys for the plaintiff class spending more than 1000 hours working on the case.
Throughout the course of the litigation, Appellees maintained that the class members were merely "required to change into jail uniforms in the presence of a corrections officer of the same sex" and that the Schenectady County Jail had no formal policy of strip searching all detainees. Ultimately, however, they agreed to the terms of a settlement, pursuant to which Appellees agreed to substantial injunctive relief and the creation of a settlement fund totaling $2.5 million. The settlement agreement, signed on July 31, 2006, indicated that Appellants' counsel would petition the court for an award of attorneys' fees "in the amount not to exceed 26%" of the total settlement fund,and also provided for the separate reimbursement of administrative expenses.
During the litigation of this case, counsel for Appellants also acted as counsel for the plaintiffs in two other actions -- each initiated prior to the filing of the complaint in this case -- alleging that other counties in New York maintained impermissible strip search policies. See Complaint, Kahler v. Rensselaer County, No. 1:03-cv-1324 (N.D.N.Y. Oct. 31, 2003); Complaint, Mariott v. County of Montgomery, No. 5:03-cv-00531 (N.D.N.Y. Apr. 29, 2003). In Kahler, the parties reached a settlement in March 2004, about three months prior to the initiation of the instant suit, which the district court ultimately approved in substantial part. See Motion to Certify Class and for Preliminary Approval of Class Action Settlement, Kahler v. Rensselaer County, No. 1:03-cv-01324 (N.D.N.Y. Mar. 18, 2004); Order, Kahler v. Rensselaer Country, No. 1:03-cv-01324 (N.D.N.Y. Sept. 23, 2004). Counsel in Kahler received attorneys' fees of approximately $442,700 out of a total settlement fund of $2.7 million, about 16% of the fund.*fn2 In Mariott, the district court granted the plaintiffs' motion for partial summary judgment in April 2006, concluding that Montgomery County's jail policies included an unconstitutional strip search for which the county was liable (although reaching no decision as to the scope of damages) and that plaintiffs' counsel, as counsel to a prevailing party in an action brought under 42 U.S.C. § 1983, were entitled to a statutory award of interim attorneys' fees. Marriott v. County of Montgomery, 426 F. Supp. 2d 1, 6-12 (N.D.N.Y. 2006). The parties thereafter reached a settlement, which received final approval in May 2007, resulting in an attorneys' fees award of $600,000 out of a total settlement fund of $2 million, or 30% of the fund. See Motion to Approve Consent Judgment (Exhibit A, Settlement Agreement), Marriott v. County of Montgomery, No. 5:03-cv-00531 (N.D.N.Y. Apr. 13, 2007); Order Granting Final Approval of Class Action Settlement and Judgment, Marriott v. County of Montgomery, No. 5:03-cv-00531 (N.D.N.Y. May 15, 2007).
On September 5, 2007, the district court in this case conducted a final fairness hearing regarding the proposed settlement agreement, during which it issued an oral decision regarding the acceptability of the agreement. In determining the proper fees to be awarded to counsel from the common fund, the court noted its duty to act as "a guardian of the rights of absent class members" and the resulting need to "approach fee awards with an eye to moderation." Oral Decision at 9.
Further observing that the calculation of a reasonable fee was committed to its sound discretion, the court indicated that "[i]n the past, both the lodestar and the percentage of fund methods have been available to district judges in calculating attorneys' fees in common fund cases," and provided a brief explanation of each approach. Id. at 9-10. As the court noted, under the lodestar method:
[T]he district court scrutinizes the fee petition to ascertain the number of hours reasonably billed to the class and then multiplies that figure by an appropriate hourly rate[.] [O]nce that initial computation has been made, the district court may, in its discretion, increase the lodestar by applying a multiplier based on other less objective factors such as the risk of litigation and the performance of the attorneys.
Id. at 9. The court stated that the percentage method, by contrast, involves setting "some percentage of the recovery as the fee," and recognized that, whether using the percentage method or lodestar method of calculating attorneys' fees, a court is guided by the factors articulated by this Circuit in Goldberger in determining a "reasonable common fund fee." Id. at 9-10; see Goldberger 209 F.3d at 47, 50. Earlier in the fairness hearing, the court had noted that the requested amount of 26% of the total settlement fund, or $650,000, was equivalent to a lodestar multiplier of 1.98 to 2.24.
The district court then embarked upon a discussion of this Court's decision in Arbor Hill Concerned Citizens Neighborhood Association v. County of Albany, 493 F.3d 110 (2d Cir. 2007), superseded by 522 F.3d 182 (2d Cir. 2008), quoting our observation that "the meaning of the term 'lodestar' has shifted over time and its value as a metaphor has deteriorated to the point of unhelpfulness." Oral Decision at 10 (quoting Arbor Hill, 493 F.3d at 117). In place of the traditional lodestar method, the district court characterized Arbor Hill as holding that:
The better course [and] the one most consistent with attorneys' fees jurisprudence is for the district court, in exercising its considerable discretion, to bear in mind all of the case specific variables that this court and other courts have identified as relevant to the ...