Steve Klein v. City of Laguna Beach
2016 U.S. App. LEXIS 578
| 9th Cir. | 2016Background
- Laguna Beach ordinances required permits (and in some versions imposed 100-yard and time restrictions) for use of sound-amplification devices on public sidewalks; city manager/police had broad discretion to grant permits.
- Steve Klein applied for permits to use amplification for religious youth outreach; city refused and subsequently the City amended/repealed and revised the ordinances several times while litigation proceeded.
- Klein sued under 42 U.S.C. § 1983, the California Constitution, and the California Bane Act seeking declaratory/injunctive relief, nominal damages, and statutory damages under the Bane Act.
- District court awarded Klein $1 nominal damages on some as-applied First Amendment claims, denied other claims, and denied attorneys’ fees under § 1988 relying on Farrar v. Hobby; it also denied fees under California law because Klein lost his state-law claims.
- Ninth Circuit held Farrar did not apply because Klein never sought compensatory damages and his suit achieved the primary, forward-looking relief (changed City policy); vacated the denial of federal fees and remanded for Hensley lodestar analysis, but affirmed denial of California fees.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Farrar exception bars § 1988 fees where plaintiff received only nominal damages | Farrar applies only when plaintiff sought substantial compensatory damages but recovered nominal; Klein sought primarily injunctive/policy change and only nominal damages | Farrar should apply to any nominal-damages outcome; denying fees appropriate because success was minimal | Farrar does not apply; because Klein sought no compensatory damages and achieved his forward-looking goal, district court must apply Hensley lodestar/Kerr factors |
| Whether Klein is a "prevailing party" under § 1988 | A plaintiff who obtains nominal damages is a prevailing party and may get fees | City conceded nominal damages but argued fees unjustified | Klein is a prevailing party; entitlement to fees must be assessed under standard § 1988 framework |
| Whether district court properly denied fees under Hensley/Kerr without lodestar because of nominal award | Klein: district court erred; must perform lodestar and consider Kerr factors where Farrar is inapplicable | City: court permissibly denied fees given de minimis results | Court vacated fee denial and remanded for lodestar/Kerr analysis under Hensley |
| Whether Klein can recover attorneys’ fees under California Civil Proc. Code § 1021.5 | Klein: entitled because he pleaded state claims and achieved public-purpose relief | City: section 1021.5 applies only to successful state claims; Klein lost state claims on the merits | Court affirmed denial of California fees because Klein did not prevail on his state-law claims in federal court |
Key Cases Cited
- Farrar v. Hobby, 506 U.S. 103 (1992) (nominal damages award may justify low or no fee when plaintiff sought substantial compensatory recovery)
- Hensley v. Eckerhart, 461 U.S. 424 (1983) (lodestar method and reasons for fee awards; degree of success controls)
- Gonzalez v. City of Maywood, 729 F.3d 1196 (9th Cir. 2013) (lodestar and Hensley/Kerr guidance in § 1988 cases)
- Stivers v. Pierce, 71 F.3d 732 (9th Cir. 1995) (Farrar limited to plaintiffs who sought substantial monetary damages)
- Sanchez v. City of Austin, 774 F.3d 873 (5th Cir. 2014) (Farrar inapplicable where plaintiffs sought policy change and secured injunctive relief)
- Romberg v. Nichols, 48 F.3d 453 (9th Cir. 1995) (applying Farrar where plaintiffs sought large sum but recovered only nominal)
- Mahach-Watkins v. Depee, 593 F.3d 1054 (9th Cir. 2010) (discussing Farrar and O’Connor concurrence factors for nominal-damage cases)
- Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep’t of Health & Human Res., 532 U.S. 598 (2001) (rejecting catalyst theory for prevailing-party status)
- Benton v. Or. Student Assistance Comm’n, 421 F.3d 901 (9th Cir. 2005) (Buckhannon did not address fee-reasonableness factors; courts may consider voluntary changes for fee calculations)