Pickett v. Sheridan Health Care Center
2011 U.S. App. LEXIS 24866
| 7th Cir. | 2011Background
- Title VII retaliation case; Pickett allegedly fired for reporting sexual harassment at Sheridan Health Care Center.
- Jury awarded Pickett $65,000 (including $15,000 compensatory and $50,000 punitive) plus back pay of $1,357.42.
- Plaintiff sought $131,665.88 in attorneys’ fees; district court awarded $70,000 to Rossiello after reductions.
- Plaintiff contractually pays 33.33% contingent fee and $7,500 flat fee plus assigns statutory fee; no credit for contingent against statutory fee.
- District court reduced Rossiello’s hourly rate to $400, applied CPI and Laffey Matrix without party notice, and reversed Abrahamson’s fees for prepaid status, prompting remand.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether district courtcould reduce hourly rate because of contingent fee | Rossiello’s rate not to be reduced for contingency; lodestar stays intact | Windfall prevention justifies reducing rate given contingent/flat fees | No; cannot reduce rate based on contingent fee; remand for re-determination without contingent-fee consideration |
| Whether evidence supported Rossiello’s claimed rate | Third-party affidavits and past awards support $580–$620 | Evidence insufficient; lower rates more persuasive | Remand to reevaluate evidence consistent with conclusions; consideration of non-contingent affidavits proper |
| Whether CPI and Laffey Matrix could be used without notice | Parties should contest methodologies before application | Court may apply objective benchmarks for rate | Abused discretion to rely without notice; remand to allow briefing on use of CPI and Laffey Matrix |
| Whether evidentiary hearing was required | Hearing requested due to sua sponte reductions | Record and briefs suffice to calculate award | Abuse of discretion to deny hearing; remand for opportunity to respond |
| Whether outside counsel Abrahamson’s fees could be denied for non-prepayment | Prevailing party entitled to reasonable fees; no prepaid requirement | Prepayment needed to award outside counsel’s fees | Reinstate Abrahamson’s fees; district court should justify any payment conditions on remand |
Key Cases Cited
- Hensley v. Eckerhart, 461 U.S. 424 (U.S. 1983) (lodestar method as center of fee determinations; multipliers discouraged)
- Venegas v. Mitchell, 495 U.S. 82 (U.S. 1990) (contingent fees do not alter statutory fee calculation; separate from lodestar)
- Blanchard v. Bergeron, 489 U.S. 87 (U.S. 1989) (lodestar method appropriate even with contingent fee agreements)
- Perdue v. Kenny A., 560 U.S. 547 (U.S. 2010) (lodestar adjustments not allowed for contingency risk; need for principled calculation)
- Dague v. City of Burlington, 505 U.S. 557 (U.S. 1992) (contingency as a factor not used to enhance or reduce lodestar; enhances prohibited)
- Spegon v. Catholic Bishop of Chi., 175 F.3d 544 (7th Cir. 1999) (prefer third-party affidavits; market rate evidence often from comparable attorneys)
- People Who Care v. Rockford Bd. of Educ., 90 F.3d 1310 (7th Cir. 1996) (affidavits from comparable attorneys assist determining market rate)
- Jeffboat, LLC v. Dir., Office of Workers' Comp. Programs, 553 F.3d 487 (7th Cir. 2009) (previous fee awards helpful to establish market rate; not exclusive)
- City of Riverside v. Rivera, 477 U.S. 561 (U.S. 1986) (separate statutory fee award and contingent fee rights; windfall concerns)