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7th Circuit: Attorney Fees are for Attorneys Only

September 13, 2012 | Posted in : Fee Jurisprudence

In a recent Courthouse New Services story, “Nice Try, But Attorneys’ Fees are for Counsel Only,” reports that a man who held Chicago police liable for excessive force cannot keep 60 percent of the amount meant for his attorneys, the seventh circuit ruled.  In a February 2006 complaint against Chicago and several officers, Morad Elusta claimed that police used excessive force while searching his home and falsely arresting him.  The city offered to settle Elusta’s claim for $100,000, but Elusta refused the offer because he was unwilling to award his attorneys, David Cerda and John DeLeon, a 40 percent share.

Eventually, Elusta hired new counsel – Zane Smith and Shelia Genson – who took the case to trial before a jury that awarded him $40,000.  The court later awarded Smith and Genson $83,000 in fees and ruled that Elusta owed his former lawyers, Cerda and DeLeon, $15,000 for their services.  Elusta then moved to have Chicago pay Cerda and DeLeon, but give him 60 percent of the amount.  He also said Smith and Genson should turn over 60 percent of their fee award to him.

A federal judge denied Elusta’s motion, and the seventh circuit affirmed last week, poking fun at Elusta’s interpretation of his agreement with his second set of lawyers.  “Elusta argues that the phrase ‘the attorney’s fees’ does not clearly cover all of the attorney’s fees,” Judge Diane Wood wrote for a three-member panel.

“We agree with the district court that this argument ‘defies logic,” Wood wrote.  “The court awarded $15,000 to Cerda and DeLeon precisely because it concluded that it would be unjust for Elusta to keep that money after he had received the benefits of Cerda and DeLeon’s services.  Elusta is thus, by definition, not entitled to keep any of it.”