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The NALFA

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Category: Practice Area: Civil Rights / Public Interest

Is Law School Relevant in Establishing Hourly Rates?

December 9, 2021

A recent Metropolitan News story, “Law School Attorney Attended Is Relevant to Fee Award,” reports that a judge was not off base in commenting at a hearing on the setting of attorney fees that a lawyer who graduated from Glendale College of Law did not rate the same hourly fee as one who earned a J.D. at Harvard or Yale, the Court of Appeal for this district held.  Santa Clara Superior Court Judge Audra Ibarra, sitting on assignment to Div. Seven, authored the opinion which was not certified for publication. 

It upholds Los Angeles Superior Court Judge William F. Fahey’s award of $320,000 in attorney fees to the plaintiff in an action under the Fair Employment and Housing Act, but reverses a $28,472 cost award because the judge mistakenly thought that recompense was available only for services of experts who were court appointed.  Of the $320,000, $200,000 was to compensate the plaintiff, James Herron, for services performed by Encino attorney Darryl M. Lucien. Herron recovered $200,000 in an action against the County of Los Angeles.

Lucien has set his hourly rate at $600; Fahey awarded fees at $500 an hour.  At the hearing on the motion, Fahey commented that attorneys “who went to Harvard or Yale typically are paid at a much higher level” than those who attended less prestigious institutions, saying that this “reflects, perhaps, an intelligence level beyond this court’s intelligence level and a dedication and a drive and a capability” that he does not “otherwise see with some other lawyers.”  (Fahey graduated from the law school at UCLA.)

Ibarra wrote: “But Herron takes the court’s comment out of context.  The court was comparing Lucien’s background and experience with other attorneys in the legal market as it was allowed to do.  The court explained, ‘Background, experience, number of years, approval by judges of those hourly rates, et cetera.  All of those are factors that this court has in mind.”  Fahey said in the order for fees: “In calculating the reasonable value of plaintiffs counsel’s services, the Court notes that it has resolved more than 100 fee motions in over 15 years….

“In this case, Lucien is a sole practitioner and is requesting $600 per hour.  However, he admits that no judge has ever approved this rate.  He graduated from Glendale University College of Law in 2002, but provides no information about his achievements there.  He conducted one misdemeanor trial while a clerk with the District Attorney’s office and 15 civil trials thereafter. He has spoken at three CLE seminars.  “This Court has seen and approved hourly rates of $400-550 for attorneys with Lucien’s background and trial experience.  Given Lucien’s pre-trial and trial skills, the Court concludes that a rate of $500/hour is reasonable.”

The judge made note that “plaintiff prevailed on only two claims and received only about 10% of the amount he sought from the jury” and his lawyers “grossly over-litigated this case prior to trial.”  Herron had sought $2,148,440 in fees based on $600 per hour for Lucien, $400 for Maximilian Lee, with a multiplier of two.  Fahey pared the number of hours as well as lowering the rate for Lucien.  The judge commented in a footnote: “Plaintiff Herron no doubt would be shocked and outraged if he was asked to pay over $2 million to his attorneys who managed to obtain a judgment of only $200,000.”

Ibarra found no abuse of discretion by Fahey, saying: “Although the trial court awarded Herron attorney fees for fewer hours than requested, we do not find the court abused its discretion based on the record before us.  Having presided over the entire case, including discovery disputes, the experienced court was well-positioned to determine if Herron’s attorneys overlitigated or padded their hours.”

Judge May Not Base Fee Award On Previous Awarded Rates

November 8, 2021

A recent story by Metropolitan News, “Judge May Not Base Fee Award on Previous Awards to Firm,” reports that a judge must make a fresh determination in each case of whether attorney fees that are sought are in line with prevailing rates in the community, rather than comparing the amounts claimed with those awarded to the same law firm in other cases of the same nature, the Ninth U.S. Circuit Court of Appeals held.  Circumstances unique to that case must also be weighed, according to the memorandum opinion.  A three-judge panel—comprised of Ninth Circuit Judges Daniel Aaron Bress and Lawrence VanDyke, joined by Tenth Circuit Judge David M. Ebel, sitting by designation—reversed a $11,349 award in favor a client of the Center for Disability Access (“CDA”).  The amount sought was $20,459.

CDA—which files torrents of actions throughout the state under the federal Americans with Disabilities Act and Callifornia’s Unruh Civil Rights Act—is a division of the San Diego firm of Potter Handy, LLP.  The plaintiff, Brian Whitaker, according to defendants SMB Group and Yoon Jeong Row, has filed more than 1,100 for in the Central District of California since 2014 claiming disability discrimination.  In the present case, the Ninth Circuit declared, District Court Judge Michael W. Fitzgerald of the Central District made some reasonable downward adjustments in the amount awarded, but erred in relying on past awards in actions brought by CDA “instead of considering other evidence of the prevailing community rates.”

The opinion says: “We cannot discern that, in its explanation of why it reduced the hourly rates sought by CDA, the district court analyzed the complexity of the case, the type of work involved, rates for non-CDA lawyers of comparable skill in the relevant community, whether the legal work was performed by lawyers at the appropriate levels of seniority, or other relevant factors….  “It may be that the district court here considered the above factors and thus the hourly rates the district court applied were appropriate.  But we cannot make that determination on the current record.  Accordingly, the district court’s fee award is vacated and the case is remanded for review consistent with this memorandum.”

The appellate judges said Carter did justify his reduction in hours spent—including subtracting hours supposedly spent at a hearing that did not take place and on an unnecessary motion—and paring block-billed hours.  At oral argument on Aug. 8, Dennis J. Price II of Potter Handy argued that the lodestar system of calculating attorney fees—multiplying hours spent times the hourly rate—“is not advisor—it’s a mandatory system” that judges must use.  He alleged that Fitzgerald “effectively ignored these rules.”

The hourly rates that were sought ranged from $450 to $595.  Those awarded went from $350 to $425.  Bress questioned whether the rates that were set by the judge would have been supportable had Fitzgerald “put in more than he did in his order.”  Price responded that the evidence would not support the lower rates.  However, asked the same question by VanDyke, he said that if Fitzgerald had “done the leg work,” he “wouldn’t have any argument that the rate was incorrect,” later reverting to his original position that “the evidence doesn’t support” the rates that were set.  Janice Ryan Mazur of the El Cajon firm of Mazur & Mazur argued for SMB Group and Row.  She said Fitzgerald did apply the lodestar method, but then adjusted it downward.

Defense ‘Prevailing Party’ in DVPA Case Dropped by Plaintiff

October 9, 2021

A recent Metropolitan News story, “Defendant Was ‘Prevailing Party’ in Action Under DVPA Where Plaintiff Dropped Case,” reports that a judge erred in finding that a defendant was not the “prevailing party” in a civil action brought to impose a domestic violence restraining order on him, the Court of Appeal for this district has held, proclaiming that he did prevail even though the circumstances were that the plaintiff dismissed her petition after gaining such an order in a separate criminal proceeding.

But, Justice Anne H. Egerton of Div. Three said in an unpublished opinion, that does not mean that the order by Los Angeles Superior Court Judge Jonathan L. Rosenbloom denying an award of attorney fees to the defendant in the civil case need be reversed.  Such an award is discretionary, she noted, and, under Art, VI, §13 of the state Constitution, reversal is called for only where an error has resulted “in a miscarriage of justice” which, she declared, did not occur.

Burbank attorney David D. Diamond—a two-time unsuccessful candidate for the Los Angeles Superior Court who has announced his candidacy in the 2022 election—represented defendant Joshua Nathaniel Rivers in the trial court and on appeal. In seeking an award of $6,300 in attorney fees in favor of his client, sued by Marcia Bennett under the Domestic Violence Prevention Act (“DVPA”), Diamond said in an April 2, 2019 notice of motion that his client was “was compelled to respond to and defend a frivolous action,” and set forth in his memorandum of points and authorities: “Petitioners case was adjudicated in favor of Respondent. On November 20, 2018 the Petitioner asked for an additional hearing date to retain an attorney.  On December 10, 2018, the new hearing date, she failed to appear.”

He added in a declaration: “It is my belief that Petitioner should pay for the Respondent’s attorney’s fees because she [sic] is the prevailing party.”  In an opposing declaration dated May 29, 2019, Northridge attorney Bernal P. Ojeda (who also represented Bennett in the appeal) protested:

“The Respondent’s claim as a prevailing party is misleading.  Respondent at the present time has a four year criminal restraining order against him, not mentioned in the current motion….[T]his was the reason Petitioner did not appear for the hearing in the instant case. The criminal case is a related case and the criminal protective order should have been mentioned to this court but was not.  Given the fact that there is an existing restraining order against Respondent and protecting Petitioner, Respondent cannot claim he is a prevailing party nor can he have that status.”  (Los Angeles Superior Court Judge Peter Mirich granted the restraining order on Nov. 30, 2018, 10 days before the hearing at which Bennett did not appear.)

Ojeda said in his memorandum of points and authorities: “The criminal action now pending is a related case, involving the same parties, same incident and set of facts.”  The minute order of the June 4 hearing before Rosenbloom on the motion for attorney fees simply recites: “The Court finds Respondent is not the prevailing party.  “Motion Hearing re attorney fees is denied with prejudice.”

In her opinion upholding the outcome, Egerton said: “Rivers has not demonstrated the trial court’s erroneous prevailing party determination resulted in a miscarriage of justice….[B]ecause Rivers was the respondent on Bennett’s petition for a domestic violence restraining order, the trial court had discretion to deny his request for prevailing party attorney fees under [Family Code] section 6344, subdivision (a).”

She continued: “On the record before us, it is not reasonably probable that the court would have awarded Rivers the attorney fees he requested, even if the court had properly deemed him the prevailing party on the petition. And, based on this record, we cannot say the court’s denial of prevailing party attorney fees would have been an abuse of discretion.”  The judge went on to say: “And, given that Bennett dismissed her petition only after already obtaining the protection she sought under the DVPA, we cannot say the trial court’s denial of attorney fees on this ground would have been an abuse of discretion.”

Judge Acted Arbitrarily in Setting ADA Attorney Fee Award

October 8, 2021

A recent Metropolitan News story, “Judge Acted Arbitrarily in Setting ADA Attorney Fee Award,” reports that a District Court judge, in setting an attorney fee award, acted arbitrarily in disregarding the services of three of five lawyers who represented the plaintff in securing a settlement of his action under the federal Americans With Disabilities Act and the state Unruh Act and by making a 10 percent deduction as a penalty for the law firm inflating its fees, the Ninth U.S. Circuit Court of Appeals held.

Its memorandum opinion comes in a case bought by the Center for Disability Access, a division of the San Diego law firm of Potter Handy LLP, on behalf of Antonio Fernandez, who is wheelchair-bound.  The center brings hundreds of ADA and Unruh actions each year, using a stable of plaintiffs, including Fernandez.  The appeal came in a case instituted in the U.S. District Court for the Central District of California against Roberta A. Torres, who owned real property in Whittier and against CBC Restaurant Corp., which operated the Corner Bakery Café on Torres’s property. The suit was brought over the height of the counter.

In making his award of attorney fees, Judge Fernando M. Olguin said in a July 14, 2020 order: “Despite many years of experience litigating the two claims in this case in virtually hundreds of cases, and a docket that reflects little, if any, litigation in this case, plaintiff seeks $15,762.50 for the work performed by five attorneys….Further, the cases filed by plaintiff include nearly identical complaints and subsequent filings.”  Olguin made note of three of the several ADA-based actions the center has recently brought in the Central District with Fernandez serving as the plaintiff.

The judge opined that the “assignment of so many experienced attorneys to such a simple case replete with boilerplate documents resulted in substantial task padding, duplication, over-conferencing, attorney stacking, and overall excessiveness,” declaring: “Given the simplicity of the case and ADA accessibility cases in general, the quick settlement and apparent lack of any contested litigation matters in this case, and the lack of any dispositive motions, no more than one partner and one associate was necessary to prosecute this case.  Thus, the court will reduce the fee award by cutting the fees for three of the five attorneys.”

He opted to take cognizance only the services of the lead attorrney, Christina “Chris” Carson, who was admitted to practice on Dec. 2, 2011, and Mark D. Potter, whose State Bar membership goes back to Dec. 1, 1993.

Potter sought recompense at an hourly rate of $595 and Carson wanted to be paid $450 an hour. Olguin said that taking into account the various factors customarily assessed in setting attorney fees, “$425 is reasonable for attorney Potter, and an hourly rate of $275 is reasonable for attorney Carson.”  Noting that there was a “quick settlement of this routine, non-complex case, where plaintiff did not file or oppose any dispositive motions,” Olguin declared that “the court will apply a ten percent reduction.”  After subtracting “10% of the time billed for general excessiveness,” he awarded $3,897 in attorney fees—slightly less than 25 percent of what was sought.  Olguin allowed the $642.50 in costs that were claimed.

Reversal came in an opinion signed by Circuit Judges Susan P. Graber and John B. Owens and by District Court Judge Charles R. Breyer of the Northern District of California, sitting by designation. The judges said: “While we agree with the district court that Fernandez’s lawyers overbilled, it was ‘arbitrary’ to ignore entirely the time billed by three of the five lawyers….These three appear to have performed at least some necessary work….To the extent that overstaffing resulted in inefficiencies, the district court should reduce the fee award in proportion to those inefficiencies, rather than Through a ‘shortcut.’ ”

The opinion continues: “The district court also abused its discretion in calculating the hours of the two attorneys whose work it considered.  The court provided cogent reasons for its specific cuts as to various tasks, but its final additional 10% reduction for ‘general excessiveness’ lacked any justification.”  Olguin did not abuse his discretion in setting the rates for Carson and Potter, the Ninth Circuit said, because they had nor provided evidence substantiating the higher value they ascribed to their services.

Harvard Sues Insurer Over Attorney Fees

September 20, 2021

A recent Law 360 story by Eli Flesch, “Harvard Sues Insurer For Legal Fees in Affirmative Action Suit,” reports that Harvard University sued Zurich American Insurance Co. for excess coverage of costs it incurred fighting a lawsuit challenging its affirmative action policies, saying the insurer wrongly denied coverage on the basis that it didn't get a timely notice of the suit.  The Ivy League school told a Massachusetts federal court that Zurich was ducking its obligation under a $15 million excess insurance policy to pay for legal fees connected to allegations that it has engaged in illegal racial balancing to the detriment of Asian American applicants.  Harvard defeated the underlying suit in two lower courts but still faces a government investigation and a potential U.S. Supreme Court fight.

In an 11-page complaint, one of Harvard's governing boards told the court that it had already maxed out its $25 million coverage limit under its policy with AIG unit National Union Fire Insurance Co. of Pittsburgh.  The university said it would continue to accrue legal fees because of a pending U.S. Department of Justice inquiry and the writ of certiorari that could bring the Title VI allegations of discrimination to the Supreme Court.

Harvard said it provided notice to Zurich of its claim in May 2017, far before its coverage under the AIG policy had been exhausted.  Despite that, the university said, Zurich denied its claim in October 2017 on the basis of "purported" late notice.  The insurer told Harvard in several letters that it would have been entitled to coverage under the policy had timely notice been given, according to the complaint.

But Harvard argued that the Zurich policy, which carried much the same terms as the AIG policy, required the university to tender notice of the claim "as soon as practicable," which it did.  Moreover, Zurich personnel were well aware of the discrimination suit, the university said, pointing out the considerable media attention drawn by the allegations.  The university is seeking a declaration of coverage and a finding of breach of contract.

The underlying suit, brought by Students for Fair Admissions, claimed that Harvard violated Title VI of the Civil Rights Act.  The group lost its case in 2018 after a closely watched three-week bench trial, a finding that the First Circuit upheld in November.  In June, the U.S. Supreme Court signaled it might take up the landmark challenge to Harvard's affirmative action admissions policy when it invited President Joe Biden's administration to weigh in on whether the school's race-conscious system is legal.