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Brady v. Wal-Mart Stores

October 29, 2010


The opinion of the court was delivered by: James Orenstein, Magistrate Judge


Plaintiff Patrick S. Brady ("Brady") seeks an award of attorneys' fees arising from his litigation of an appeal before the United States Court of Appeals for the Second Circuit, as well as post-judgment interest on the fee award and on attorneys' fees previously awarded in this court. For the reasons set forth below, I award a total of $109,804.67 in supplemental attorneys' fees, including $14,130.00 for the period of April 26, 2006 through November 30, 2006, and $95,674.57 for the period of December 1, 2006, through August 25, 2008. I further award Brady post-judgment interest on the supplemental fee award (but not on the original award of attorneys' fees) at an annual rate of 3.39 percent, payable as of the date of judgment, June 23, 2005, for a total of $19,917.28 through the date of this order, and an additional $10.20 per day thereafter until the award is paid.

I. Background

Brady filed this discrimination action against his former employer, Wal-Mart Stores, Inc. ("Wal-Mart"), and two of its managers, alleging violations of the Americans with Disabilities Act ("ADA"), 29 U.S.C. ' 12101, et seq. and the New York Human Rights Law ("NYHRL"), N.Y. Exec. Law ' 290, et seq. Docket Entry ("DE") 33 (Amended Complaint). Following a trial, and on the basis of the jury's verdict (which absolved one of the managers of any liability), I directed the Clerk to enter judgment in favor of Brady jointly and severally against Wal-Mart and against manager Yem Hung Chin ("Chin") in the amount of $2,500,000, and against Wal-Mart alone in the additional amount of $300,002. See DE 111.

In extensive post-trial litigation, Wal-Mart and Chin sought judgment in their favor as a matter of law as well as a new trial, or in the alternative for remittitur of compensatory damages. DE 120; DE 122; see Fed. R. Civ. P. 50(b), 59(a). Brady also sought relief in the form of an application for costs, including attorneys' fees. DE 115; see Fed. R. Civ. P. 54(d). On September 29, 2006, I denied the defendants' motions,*fn1 and awarded Brady a total of $644,145.22 in costs including reasonable attorneys' fees. See Brady v. Wal-Mart Stores, Inc., 455 F. Supp. 2d 157 (E.D.N.Y. 2006) ("Brady I"). Wal-Mart timely appealed my decision on November 29, 2006. DE 172. The United States Court of Appeals for the Second Circuit affirmed the decision on July 2, 2008. Brady v. Wal-Mart Stores, Inc., 531 F.3d 127 (2d Cir. 2008) ("Brady II").

On July 16, 2008, Brady asked the appellate court to award him additional attorneys' fees relating to litigation in two separate periods: post-trial litigation from the submission of his original fee application in this court through the filing of Wal-Mart's notice of appeal, from April 25, 2006 through November 30, 2006; and litigation of the appeal, beginning on December 1, 2006.*fn2 Brady also requested an increase in the amount of fees and costs I had previously awarded, as well as post-judgment interest on that award. See DE 178; Plaintiff-Appellee's Motion for Attorneys' Fees ("Motion") at 1.*fn3 The appellate court denied Brady's motion to increase the original award in this court, held that Brady is entitled to an award of fees for the appellate litigation, and remanded the matter to this court for a determination of the appropriate amount of such fees as well as a determination in the first instance concerning post-judgment interest. DE 179.*fn4

II. Discussion

Courts in this circuit assess fee applications using the "lodestar method," under which a reasonable hourly rate is multiplied by a reasonable number of hours expended. See Luciano v. Olsten Corp., 109 F.3d 111, 115 (2d Cir. 1997); King v. JCS Enterprises, Inc.,325 F. Supp. 2d 162, 166 (E.D.N.Y. 2004) (citing Green v. Torres, 361 F.3d 96, 98 (2d Cir. 2004); Quarantino v. Tiffany & Co., 166 F.3d 422, 425 (2d Cir. 1999)).*fn5 District courts have broad discretion, using "'their experience with the case, as well as their experience with the practice of law, to assess the reasonableness'" of each component of a fee award. Fox Indus., Inc. v. Gurovich, 2005 WL 2305002, at *2 (E.D.N.Y. Sept. 21, 2005) (quoting Clarke v. Frank, 960 F.2d 1146, 1153 (2d Cir. 1992)). I therefore examine the reasonableness of both the hourly rates claimed by Brady's attorneys and the number of hours of work they billed in this litigation.

A. Hourly Rate

Because a client who can recover attorneys' fees through a fee shifting statute has little incentive to negotiate rates with his attorney prior to litigation, "the district court must act later to ensure that the attorney does not recoup fees that the market would not otherwise bear." Arbor Hill, 522 F.3dat 184. The district court "bears the burden of disciplining the market" and setting a "reasonable hourly rate" for the services of counsel. A reasonable hourly rate is the rate a "reasonable, paying client" would be willing to pay. Id.; see also McDaniel v. County of Schenectady, 595 F.3d 411, 420 (2d Cir. 2010) (a presumptively reasonable fee represents an approximation of "what a competitive market would bear"); Manzo v. Sovereign Motor Cars, Ltd., 2010 WL 1930237, at *7 (E.D.N.Y. May 11, 2010) (a presumptively reasonable fee "boils down to what a reasonable, paying client would be willing to pay, given that such a party wishes to spend the minimum necessary to litigate the case effectively") (quoting Simmons v. N.Y.C. Transit Auth., 575 F.3d 170, 174 (2d Cir. 2009) (quotation marks omitted)). The court may "rely on [the court's] own knowledge of comparable rates" charged by lawyers in the community, Morris v. Eversley, 343 F. Supp. 2d 234, 245 (S.D.N.Y. 2004) (citing Ramirez v. New York City Off-Track Betting Corp., 1997 WL 160369, at *2 (S.D.N.Y. Apr. 3, 1997)), "as well as on evidence submitted by the parties." Stirrat v. Ace Audio/Visual, Inc., 2007 WL 2229993, at *2 (E.D.N.Y. July 31, 2007) (citing Farbotko v. Clinton County of New York, 433 F.3d 204, 209 (2d Cir. 2005)). "[T]he burden is on the fee applicant to produce satisfactory evidence... that the requested rates are in line with those prevailing in the community for similar services by lawyers of reasonably comparable skill, experience, and reputation." Blum v. Stenson, 465 U.S. 886, 895 n.11 (1984).

The relevant legal "community" is generally the district in which the court is located. See Luciano v. Olsten Corp., 109 F.3d 111, 115 (2d Cir. 1997); Coated Fabrics Co. v. Mirle Corp., 2008 WL 163598, at *7 (E.D.N.Y. Jan. 16, 2008). As a result, I look to the rates prevailing in the Eastern District of New York, notwithstanding the fact that all parties in this case engaged -- and Wal-Mart was manifestly willing to pay -- attorneys from the Southern District of New York.

In asking the appellate court to increase the fees I had already awarded, Brady contended that the later decision in Arbor Hill demonstrated the error of my reliance on the Eastern District of New York as the relevant community for determining fees. Motion at 18-20. The court rejected that argument and held that applying the prevailing rates in this district was consistent with Arbor Hill. DE 179 at 1-2. Since that decision, the applicable law has developed further, see, e.g., Simmons, 575 F.3d 170, and I therefore take a fresh look at the appropriate geographical area to be considered in determining a reasonable hourly rate.

While a court "may use an out-of-district hourly rate -- or some rate in between the outof-district rate sought and the rates charged by local attorneys... if it is clear that a reasonable, paying client would have paid those higher rates[,]" it is presumed "that a reasonable, paying client would in most cases hire counsel whose rates are consistent with those charged locally." Arbor Hill, 522 F.3d at 191 (2d Cir. 2008). In order to overcome that presumption, Brady must establish "that a reasonable client would have selected out-of-district counsel because doing so would likely (not just possibly) produce a substantially better net result." Simmons, 575 F.3d at 175. Meeting that burden requires Brady to make a particularized showing, not only that the selection of out-of-district counsel was predicated on experience-based, objective factors, but also of the likelihood that use of in-district counsel would produce a substantially inferior result.... Among the ways an applicant may make such a showing is by establishing that local counsel possessing requisite experience were unwilling or unable to take the case, [In re "Agent Orange" Prod. Liab. Litig.], 818 F.2d [226,] 232 [(2d Cir. 1987)], or by establishing, in a case requiring special expertise, that no in-district counsel possessed such expertise.

Id. at 176; see also id. at 177 ("The [defendant] should not be required to pay for a limousine when a sedan could have done the job."); Vilkhu v. City of New York, 372 F. App'x 222, 224 (2d Cir. 2010).*fn6

The district court may adjust the hourly rate to account for "case-specific variables" relevant to evaluating the market rate for comparable legal services, bearing in mind that "a reasonable, paying client wishes to spend the minimum necessary to litigate the case effectively." Arbor Hill, 522 F.3d at 190. Factors to consider include, but are not limited to, the attorney's customary hourly rate, the complexity and difficulty of the case, the resources required to prosecute the case effectively (taking account of the resources being marshaled on the other side), the experience, reputation and ability of the attorneys, the preclusion of employment by the attorney due to acceptance of the case, and the different rates prevalent in different practice areas, among other considerations. Id. at 184 & n.2, 187 n.3; see also Johnson v. Ga. Highway Express, Inc., 488 F.2d 714, 717-19 (5th Cir. 1974) (listing twelve factors to be considered by courts in determining the rate a reasonable client would be willing to pay).*fn7 The size of the firm may also be considered, in part because of the varying overhead costs incurred by larger firms, but also where the complexity of a case requires a larger firm to effectively litigate it, or where, because of its small size, a firm is forced to forego opportunities to represent clients in other matters that a larger firm would be able to handle. See Chambless v. Masters, Mates & Pilots Pension Plan, 885 F.2d 1053, 1059 (2d Cir. 1989); Simmonds v. New York City Dept. of Corrections, 2008 WL 4303474, at *2 (S.D.N.Y. Sept. 16, 2008); Murray ex rel. Murray v. Mills, 354 F. Supp. 2d 231, 236 (E.D.N.Y. 2005) (noting that hourly rates tend to be higher at large firms to compensate for higher overhead costs); Brady I, 455 F. Supp. 2d at 206-07.*fn8

Brady seeks to have his attorneys reimbursed at the following hourly rates: $500-$600 for Douglas H. Wigdor ("Wigdor"), a partner in the law firm of Thompson Wigdor & Gilly LLP ("TWG") with 15 years of experience in practice at the time the appeal concluded; the same for TWG partner Scott Gilly ("Gilly") and associate Andrew S. Goodstadt ("Goodstadt"), who have 15 and 10 years' experience, respectively; $250 to $390 for TWG associates Michelle Le Roux ("Le Roux") (six years in practice), Jihee G. Suh ("Suh") (five years), Ariel Y. Graff ("Graff") (one year), Renan F. Varghese ("Varghese") (less than one year), and Cindy Uh ("Uh") (less than one year); and $125-$140 for the work of paralegal assistants Joshua Drian ("Drian"), George Vallas ("Vallas"), Jillian Howell ("Howell"), and Patrick J. Scanlan ("Scanlan"). Motion at 4-5; Wigdor Dec. at 19-27; Wigdor Reply Dec. Ex. B.*fn9 I have previously determined reasonable hourly rates for some of the attorneys for their work in this case up to the time of the initial fee award; specifically, I based the prior award on hourly rates of $350 for Wigdor and Gilly, $225 for Goodstadt, $200 for Le Roux, $150 for Varghese, and $100 for each paralegal assistant. Brady I, 455 F. Supp. 2d at 208.

Brady urges me to consider several factors as justifying the rates his attorneys claim: he points to their expertise and the skill required to defend the appeal; the rates they command from paying clients; Wal-Mart's resources and those required in response; the results they obtained; the "undesirability" of this case; and the opportunity cost arising from the fact that TWG's relatively small size precluded it from litigating other matters while engaged in this action.*fn10

Motion at 10-16. Even taking all of those factors into account, the hourly rates Brady's attorneys claim are far higher than those that prevail in this district under comparable circumstances.

The market rate for civil rights litigation services is lower than that for some other areas of practice, particularly those involving more affluent corporate clients. Morris v. Eversley, 343 F. Supp. 2d 234, 247 (S.D.N.Y. 2004) (noting that "markets and billing conditions are different" between civil rights and corporate practice, and that rates charged by large firms "exceed the rates usually charged by similarly experienced civil rights attorneys"); Heng Chan v. Sung Yue Tung Corp, 2007 WL 1373118, at *3 (S.D.N.Y. May 8, 2007); Pastre v. Weber, 800 F. Supp. 1120, 1125 (S.D.N.Y. 1991) (counsel at large firm entitled to the rates that "would have been charged by a competent attorney specializing in civil rights litigation" rather than the rates paid by corporate clients). Thus, while I have no doubt that Brady's attorneys can command hourly rates as high as $750 from some paying clients, see Wigdor Dec. Ex. B (providing examples), that fact does not require Wal-Mart to pay such rates in the circumstances of this case.

For exceptionally difficult and complex civil rights cases, a relatively high hourly rate may be appropriate. See Heng Chan, 2007 WL 1373118, at *3 (awarding $450 an hour, at the high end of the prevailing market rate for civil rights litigation). In the average case, however, rates are lower. See Simmonds v. New York City Dept. of Corrections, 2008 WL 4303474, at *5 (S.D.N.Y. Sept. 16, 2008) (refusing to apply rates that would be appropriate for "extraordinarily complex, class action lawsuits requiring an enormous investment of time and resources"; awarding $225 to $425 for attorneys with 4 to 22 years experience for case that "involved a single plaintiff asserting several novel theories of liability alongside a compelling traditional gender discrimination claim[.]"). This case, involving a single plaintiff and two defendants, and a traditional ...

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