*1 COPELAND, Individually and Dolores J.
on behalf of the class of all others
similarly situated MARSHALL, Ray Secretary
F. of Labor al., Appellants.
et
No. 77-1351. Appeals,
United States Court of
District of Columbia Circuit.
Argued En Banc Oct. Rehearing Sept.
On En Banc *3 Dorsen, Seymour, M. Richard Rich-
David Kohn, Boggs, Ann Roderic V. 0. ard S. C.,D. were on Macrory, Washington, K. curiae, Lawyers’ Commit- brief for amicus Rights Law. tee for Civil Under III, Stephen Charles M. Nabrit James Ralston, Lee, Schnapper, Bill Lann and Eric for amicus City, York were on brief New curiae, and Educa- Legal NAACP Defense Fund, Inc. tional C., Terris, Washington, D. Bruce J. curiae, Law on brief for amicus Office Bruce J. Terris. *4 Richards, C., Washington, D.
James R. curiae, Capital Le- was on brief for amicus gal Foundation. WRIGHT, Judge, Chief and
Before TAMM, LEVENTHAL,* McGOWAN, ROB INSON, MacKINNON, ROBB, WILKEY Lamberth, Atty., U. Asst. S. Royce C. MIKVA, Judges. and Circuit C., whom Earl J. Sil- D. Washington, C., Washington, D. at the bert, Atty., U. S. Judge McGOW- Opinion filed Circuit filed, Terry, John A. the brief was time AN, Judge WRIGHT and in which Chief Pease, Asst. U. Levy, and Neil I. D. William W. ROBIN- Judges Circuit SPOTTSWOOD C., brief, D. were on Washington, Attys., S. MacKINNON, SON, III, and ROBB appellants. for join. MIKVA and Leonard Schait- Morton Hollander Justice, Washington, man, Dept, of Attys., Judge Opinion concurring filed Circuit C., appearances appel- for also entered D. MacKINNON, Judge in which Circuit lants. joins. ROBB City, with New York Hupper, John R. Judge dissenting filed Circuit Opinion Pickering, Roger J. Wollen- H. whom John WILKEY, Judge TAMM in which Circuit Wilson, Mary McReynolds, A. berg, Gary D. joins. II, Washington, D. and John H. Harwood C., brief, appellees. for were on EN BANC ON REHEARING C., Cutler, Washington, D. also
Lloyd N. appellees. appearance entered an McGOWAN, Judge: Circuit C., Washington, D. Prager, Lutz A. it for re en banc has before The court curiae, Opportu- Equal Employment amicus the District Court award view an order of nity Commission. $160,000 for the attorney’s fee of ing an gender-discrimi prosecution successful C., Washington, D. Halpern, Charles R. the United curiae, against nation class suit States American was on brief for amici panel A of this Union, Department of Labor.1 al. Liberties et Civil * Pickering). prior Leventhal, (now Pickering In Judge Wilmer & of the Court a member Circuit sought before the and obtained died in which this firm when it considered opinion cases pro prevailing party case was issued. in a bono as the Copeland representation plaintiff 1. The publico by pro Wash- undertaken ington, bono Wilmer, D.C., & law firm of Cutler Equal
court earlier reversed the District Court’s Employment (EEO) Opportunity award and remanded for reconsideration in April, counselor but no action was under the novel standards described its formally complained taken. She therefore I).2 opinion (Copeland panel denied of discrimination in June. July Between rehearing, opinion but a second issued September, and the Department in- (Copeland II)3 clarifying the first. We vestigated complaint. Copeland her filed granted rehearing en banc respect comments and criticisms with investigation report. and (1) appeal At issue in this stan- applied awarding attorney’s dards to be The Department reopened its investiga- fees in Title govern- VII suits November, tion in and submitted supple- ment, (2) the reasonableness of the reports mental in January February, District Court’s fee award in this case. For Copeland thought this supple- below, the reasons set forth we affirm the investigation mental inadequate, also was District Court’s award. began therefore her own investigation. She interviewed numerous current and for- I mer employees, sought Directorate affi- We cannot determine whether the Dis- support allegations davits that would her trict Court’s fee award was reasonable April,. Copeland discrimination. examining without in some detail the histo- findings, submitted her and her comments ry employment of this litiga- discrimination Department’s on the supplemental investi- tion. This chronicle is necessarily lengthy gation, to the EEO Director. *5 because the lawsuit involved numerous and Secretary Assistant Fred G. Clark sub- complex proceedings maneuverings. and proposed disposition mitted his of the com- We think the very intricacy litiga- plaint June, 1974. That disposition tion—which product, part, was a would have removed all adverse references government’s vigorous long-continued and file, personnel from her proposed but it no resistance to the claim asserted it-is significant other relief. highly relevant to the reasonableness of the Copeland, dissatisfied, requested still a fee award. hearing. formal Her file was sent to the Copeland’s A. Civil Service Commission for Complaint purpose, Administrative but no hearing was held. The file was Appellee Copeland, Dolores a black wom- returned to the Department Labor without an trained in processing, joined data explanation. Department (the Department) of Labor 1967. years She worked for several in the Secretary Assistant Clark resubmitted his Department’s Directorate proposed disposition of Data Automa- Copeland’s com- tion and predecessor (the its unit plaint Director- in September, 1974. According to ate) computer as a specialist. Copeland, GS-13 Cope- she was assured that because she thought land supervisors that her already were un- had requested hearing, she need fairly denying training, promotions, her repeat not request. interesting Moreover, work. she believed held, hearing however, No was and the
that other female employees Directorate Department issued its final decision on No- were treated similarly. vember 1974. The final decision conced-
Pursuant
regulations, Copeland
ex-
ed
pattern
“that a
of sex discrimination
plained
suspicions
her
a Department
Directorate,
exists” in the
and that such
this,
Marshall,
such as
Copeland
the firm has contributed the fee to
2.
(1978).
future assess her Certification objectively responsibilities them, (3) adverse expunge performance represent moved that she Copeland next file, (4) personnel her from evaluations fe- past, present, and future a class of all to in- decisions promotion future monitor employees in the Di- processing male data mi- her and other treatment sure fair however, government, rectorate. The Depart- The employees and women. nority the case to the Civil Ser- moved to remand however, not, retroactive offer ment did hearings vice for additional Commission consid- pay, priority and back promotion alternative, and, opposed class certifi- promotions. for future eration variety of reasons. cation for a copy Copeland sent Department denied the motion The District Court However, Copeland’s its decision. the case The court also certified remand. in violation of copy, with a were not served suit, all females em- covering as a class regulations. Department processing by the Directorate in data ployed 11, 1971. after June positions in the District Court Litigation B. in the Dis- this class suit Copeland filed Discovery Skirmishes December
trict Court on *6 pro- attorneys meanwhile had Copeland’s amended, gen- alleged three complaint, as discovery requests, pounded congeries a counts, viola- namely, der discrimination requests for including interrogatories and Rights Act (1) VII of the Civil tions of Title discovery These production of documents. (3) 1964, (2) Executive and Order flurry acrimonious requests prompted an the first and fifth amendments rights under plaintiff (plaintiff) class between the and 42 U.S.C. section to the constitution the defendant. alleged a count of complaint 1985. The also fifth under the first and comply race discrimination government initially did not The sections 1981 and 42 U.S.C. amendments to requests. Plaintiff moved with these and 1985. then discovery. government The compel interrogatories, but some of the answered Judg- for The Motion Government’s thought objected others that to certain Pleadings ment on the The information. privileged called for accordingly, opposed mo- government, promptly moved for government
The compel. variety under a tion to judgment pleadings on the employees allege government granted who discrimination on federal 5. The District Court sex, (2) jurisdic- judgment pleadings absence of for the count based the basis of race or on the except defendants and also ordered tion over all individual on Executive Order Labor, (3) Secretary ad- tried before the failure to exhaust the Title VII count be remedies, (4) primary jurisdic- constitutional counts. ministrative Department Ser- Labor and Civil tion of judgment government on The also moved for did not The District Court vice Commission. counts, asserting pleadings on various any in its order. these theories address remedy (1) for exclusiveness of Title VII as pointed quested Plaintiff out to the court that the grant the court judgment on Department destroyed had certain relevant the merits as the sanction for nondisclosure. that, event, documents6 and in The District Court noted: government’s responses many interroga- to ample ground complain. Plaintiff has inadequate. question tories were The systematic Her discovery efforts initiated adequacy government’s response ago impeded months have been unneces- discovery requests generally was ulti- sarily expend and she has been forced to mately by negotiation. resolved gaps proof time and effort to fill Meanwhile, government had initiated which largely the documents would have discovery government pro- of its own. The they produced they avoided had been pounded interrogatories, requested docu- should have been. ments, depositions. and took Plaintiff con- The court nevertheless denied the motion discovery tinued the by noticing battle sanctions, prejudice, repre- without “as deposition of an Assistant Secretary of La- senting too extreme a sanction on the basis The government protec- bor. moved for a presently of facts parties available.” The order; tive this motion was denied. point plan continued to for Febru- Discovery continued for several addition- ary 16 trial. al weeks. Plaintiff answered defendant’s time for the liability the issues and evidence in the case.”7 *The that were interrogatories of its sought ther depositions. any requested documents and information sioned that discovery Court ordered the numerous The District Court all along had envi January part 1976. The “due to the extreme complexity of interrogatories, relevant and protective for a one-month delay in government, however, The government trial to would be own, order; nonprivileged. government served additional and noticed fur- begin completed the District February supply asked again trial, three conceded that the Directorate had parties 4. The Government’s Concession of Lia- tion in assignments, conditions, all in violation of Title VII subjected [Copeland] and the other mem bers of the class to sex-based discrimina Instead of ance discrimination, years bility evaluations, settled the after going Copeland promotions and working liability government trial, however, training, perform first issue. Now complained finally however, government agreed also Judge, develop District par insisted that put into promptly court-approved ties effect a discovery prepare finish affirma- liability program.9 trial tive action February 16 as originally planned. stipulation provided for a trial on *7 orally
Plaintiff to each of complained plaintiffs. relief the individual to the court trials, on January 26 In those government about additional the discovery carry would difficulties. alleged Plaintiff the burden proving that that the conceded sex government identify produce failed to and discrimination had not “monetarily or oth- certain highly documents, relevant and re- erwise” particular affected the plaintiff. government 6. The stipulation conceded that it inadvertent- 8. The noted that “Defendant asserts ly destroyed documents, argued had some but presently violating that he is not Title VII.” any that relevant information contained therein could be obtained from other sources. exchange government’s 9. In for the conces- sions, plaintiff stipulated dismissal, to the with sought 7. The continuance was because prejudice, complaint of the counts of the that government’s principal attorney military had a abeyance pending litigation had been held in obligation preparation service that trial made supra. the Title VII claim. See note 5 government difficult. The contended that complex case was too to substitute new coun- sel. tumty participate training program, to a for Retro- Copeland’s Claim Trial 5. Approx- of the above. Pay or some combination Back Promotion and active $33,000 in was obtained. imately pay back stipulated government after the Shortly sex, a basis of on the had discriminated Program 7. The Affirmative Action vel non the relief trial ensued on six-day Meanwhile, parties haggled over government Copeland. The plaintiff due program. of the affirmative action terms event Copeland contended government proposed plan; plaintiff a The GS-14, to promoted been not have would inadequate. it as The District criticized pro- receive failure to Copeland’s because hearing problems discuss held a to Court training to was attributable and motions government’s plan.10 with the and work, qualifications, lack of poor her proposed its own affirma- Plaintiff later problems. personality government The criti- program. tive action however, found, District Court The it, another and the District Court held cized sex prove that government had failed to hearing.11 following District day, the Cope- part a play did discrimination parties negotiate a Court ordered court, ac- advancement. The land’s lack of satisfactory using defend- mutually plan, promotion her GS- cordingly, awarded a but incor- starting point, ant’s draft as $6,169.80 The court pay. in back 14 and sought by porating various modifications provide Department also ordered August 1, 1976, On the District plaintiff.12 assignments training and Copeland ac- approved 36-page affirmative Court position. with her commensurate parties. plan negotiated tion Master on Litigation Special Before a 6. Attor- Application 8. Plaintiff’s for an Pay and Back Promotion Retroactive ney’s Fee for Other Class Members 30, plaintiff November filed a docu- On appointment parties stipulated to the an request mented costs and Special Master receive evidence of a revealed that fee. The documentation the relief the District Court on report 3,602 hours spent had plaintiff’s class. the other members of the due that, if that time were on the case dis- initiated new round of Each side customary hourly at the law firm’s billed Spe- presented issues covery on the $206,000. rates, fee would be about Plaintiff addition- propounded 20, 1976, cial Master. December papers filed interrogatories, requested admissions al “an[y] ap- award even opposed government defendant, deposi- further $206,000. from noticed content proaching” Apparently more in- propounded Defendant also tions. fee issue to the to submit admissions, requested terrogatories, papers, government did judge on the hearing. sought more documents. District Court to hold a not ask the 6, 1977, dis- District Court January After substantial additional On $160,000 fee, parties remaining awarding an covery, the settled entered order less than general- approximately claims. The amount 22% individual settlements by plaintiff’s papers. The pay, oppor- envisioned ly required promotions, back plaintiff’s changes hearing proposed Among topics were Some of the discussed at the incorporated mecha- the need for an effective enforcement the District Court ordered *8 nism, potential bargaining (1) (2) plan reporting, difficul- collective train- into the concerned ties, quotas promotions, notification, (3) (4) programs, employee for record the need training programs, keeping, appropriations (5) panels, composition reten- of evaluation composition panels. promotion of by and the jurisdiction to insure com- tion of the court pliance. necessity hearing this was the of 11. At issue in (2) (1) hiring promotion quotas, and jurisdiction case to court’s retention of over the by compliance Department. ensure accompanied by four-page order was lacked in experience seasoned trial was analyzing request. by memorandum the fee They offset other factors. al- were wrote, pertinent part: ways The District prepared, Court well effective and know- ledgeable. deliberately No time was apparently The believes Secretary a fee proceeded wasted and counsel with full type award in this a case of should be recognition congressional upon of directive primarily monetary based re- expedite litigation to of type. sults ap- achieved. This is an erroneous proach problem. to the fee While the services, however, Billing actual to cash awards individual members should merely not be a exer- mechanical of the class were in this instance relative- cise. sought Where a fee is from claim, ly small in to the total fee relation States, United which ability has infinite equity this was an basically action which pay, must Court scrutinize was intended and did achieve benefits particular ap- claim with care. When an solely cannot be measured in mone- plication by large such this is as filed tary judgment, terms. which The has not law computing firm a proposed by award appealed, among things been other estab- rates,” use “customary of the firm has pattern training lished entirely an new of little, obviously any, made if effort promotion employees for female judgment. billing exercise im- Thus an important an segment Department portant ingredient lacking. A reasona- of blatantly Labor which had discriminat- ble fee can be fixed the exercise ed women. The benefits of the judgment, using com- mechanical litigation many years will be felt for putations simply as a starting point to come. higher reach a figure. lower The
[*] [*] [*] [*] [*] [*] Court must perform this function. While Secretary suggests now In considering what is a reasonable fee there were no really serious issues at in this instance a number of factors de- stake, this is out by not borne the facts. serve special mention. The proposed fee went forward in a relative- expensive absorbs not only such overhead ly civilized manner but it was hard as services, rent and secretarial but no fought. firm, The Government offered charge has made been for what un- was persistent throughout resistance the liti- doubtedly a substantial amount time gation and developed only concessions spent by paralegals play who use- such a apparent became pros- there was little ful large role in documentary cases. On pect Indeed, of Government success. hand, the other there practically no Government moved dismiss at the out- partner expended time on this case and set, opposed and it discovery. There experienced associates lacked trial di- were many difficulties encountered dur- rection. The Court must also take into ing the discovery process which were account the fact not all of the work caused, part, Department’s in- proved productive. Some issues which advertent destruction certain records joined were complaint were contrary to Court direction and the inten- dropped, as some were individual defend- tional withholding of other documents by Taking ants. into account each of some Department officials of the of La- factors itemized Evans v. Sheraton bor, as well as the complexity of the Hotel, Park (D.C.Cir.1974), F.2d 177 issues. including the matters specifically men- 3,602 logged hours were tioned, the has Court concluded that a almost entirely by associates the firm with litigation, reasonable fee in this weighing varying degrees experience. achieved, The aver- the results novelty of age rate issues, hour is $57.17 well within the difficulties encountered and range local for associates of larger repre- effectiveness the excellent firms .... plaintiffs’ What $160,000. counsel given sentation
889
Inc.,
Piggie
Enterprises,
Newman v.
Park
II
964, 966-67, 19
400,401-02, 88 S.Ct.
390 U.S.
1964
Rights Act of
VII of the Civil
Title
omitted)14;
(1968) (footnotes
L.Ed.2d 1263
receive from
party to
prevailing
the
allows
Club, Inc., v.
Gaslight
accord,
York
New
in ad-
attorney’s fee
reasonable
the loser a
2024,
54, 60-66,
Carey, 447
100
U.S.
S.Ct.
provides:
The statute
to other relief.
dition
2029-2032,
(1980).
Simply to articulate those twelve District court judges for this reason have however, conjure up does not itself a rea- difficulty applying had the Johnson factors. figure sonable dollar in the mind of a dis- common, understandable, A yet fault is for judge. trict court A formula necessary judge the trial the conclusory make translate the relevant factors into terms of statement, considering “After each of the dollars particularly and cents. This is true Johnson, twelve factors in I find that a overlap because the twelve factors consider- reasonable fee is X very dollars.” This ably. example, largely For subsumed under See, often leads to reversal and remand. e. required” the factor “time and labor is an g., Gay Trustees, 127, v. Board of 608 F.2d “difficulty ques- assessment of the (5th 1979); Fletcher, 128 Cir. Davis v. 598 tions.” That is so because the more diffi- 469, (5th 1979). F.2d 470-71 Cir. cult problem, longer it will take Appellate recognized courts have that the adequately to Similarly, solve it. the cus- factors, tomary hourly (Johnson 5) despite Johnson fee factor # their substantial likely (# 3) value, to be the level conceptual influenced imprecise.16 also are services, necessary perform skill courts, therefore, Some have incorporated (# 6) whether the fee is fixed or contin- the twelve analytical factors into an frame- (# limitations, gent, 7) (# 8) time the work that easily applied can be by trial obtained, (# 9) amount to be reputa- courts and that possible will make meaning- (# attorneys, 10) tion of the the unde- ful appellate review. sirability of the case. Any fee-setting reasons, pro formula must For these scholars have noted duce an factors, award pri twelve Johnson sufficient to fulfill the without more, guarantee mary cannot a rational setting purpose of awarding fees in Title VII of fees. One cases, commented: namely, encourage “to individuals in jured problem fundamental . ap- an . . judicial discrimination to seek proach that does no more than assure Park, Piggie 402, relief.” 390 U.S. at that the lower ple- courts will consider a S.Ct. at 966. An award of provides thora of conflicting and at least partially competent incentive to lawyers to under redundant factors is that provides no take Title VII work if the award ade analytical framework for their applica- quately compensates tion. guidance offers no on the rela- amount performed. of work The Court of importance factor,
tive
of each
whether Appeals for the Third Circuit was the first
they are
applied
to be
differently in dif-
to develop
fee-setting
formula that re
contexts, or, indeed,
ferent
how they are
flects
principle.
In Lindy Bros. Build
applied
to be
at all.
ers, Inc. v. American Radiator & Standard
Berger, Court
Attorneys’
Awarded
Fees:
Sanitary Corp.,
(1973)
work
of Educ.,
administrative
See also Northcross v. Board
611 F.2d
claims,
Equal Employment
Title VII
(6th
1979).
642-43
Opportunity
adopted
Commission
the same
24,130
Fed.Reg.
(1980).
factors. 45
Reasonably Expended
1. Hours
computed by mul-
fee-should be
“lodestar”
*11
by the
hourly rate
a reasonable
tiplying
purpose
The fundamental
of the fee
expended on
reasonably
number of hours
compensate
attorney
award is
for his
Adjustments
lawsuit. 487 F.2d at
The first task for the trial court
efforts.
appropriate,
the court
figure
in this
are
therefore,
judge,
determining
the amount
provides “the
recognized, but the “lodestar”
reasonably expended.
of time
objective” starting point
only reasonably
fee,
When a law firm seeks a
it should
awarding a fee. Id.
performed.
of work
document the amount
Treasury Employees Union v. The District
then will be able to do
In National
Court
merely lump together
more than
all the
Nixon,
(D.C.Cir. 1975),
F.2d 317
this
attorneys
spent by
hours
the various
associ-
again
had occasion
to consider fee
court
enterprise;
judge
instead
ated
Lindy’s impor-
recognized
calculation. We
segregate
categories
can
into
the kinds of
inquiry,
to the
analytical
tant
contribution
participating
each
performed by
work
at-
adopted
framework for use in
and we
its
torney.
project
unduly
This
need not be
circuit. We said:
this
burdensome:
with a determination
inquiry begins
necessary
It
is not
to know the exact
litigation.
of the time devoted
spent
precise
number of minutes
nor the
multiplied by an
figure
This
in turn is
activity to which each hour was devoted
attorney’s work com-
hourly rate for each
of each at-
specific
nor the
attainments
ponent,
presumably
a rate which
would
torney.
fairly
But without some
definite
attorney’s legal rep-
into account the
take
information as to the hours devoted
experience.
resulting
utation and
activities,
general
g., pretrial
e.
various
important starting
figure represents an
discovery,
negotiations,
settlement
objec-
point
“provides
because it
spent by
the hours
various classes of at-
valuing
attorney’s
an
serv-
tive basis for
junior part-
torneys, g.,
partners,
e.
senior
[citing Lindy
ices”
].
ners, associates, the
cannot know
court
(footnote omitted).
Id. at 322
of the services for which com-
nature
pensation
sought.
Myriad
involving
cases
court-awarded
I,
Lindy
nent in
It is no less
properly
here. Hours that are
billed
A. The “Lodestar”
properly
one’s client also are not
billed to
inquiry begins with
Any fee-setting
statutory au
adversary pursuant
one’s
the number of hours rea
the “lodestar”:
Thus,
is due for
thority.
compensation
no
sonably expended multiplied by a reasona
nonproductive
example,
time. For
where
figure generated by
ble
rate. The
hearing
present
three
at a
computation
is the basic fee from
suffice, compensation
when one would
judge
which a trial court
should work. We
should be denied for the excess time. Simi
problems
below some of the
larly,
compensation
paid
examine
no
should be
upon
claims
which the
calculating
spent litigating
the “lodestar.”
time
arise
"Reasonable”?,
Attorneys’
ed
Fees: What is
17. One law review article counted at least sev-
authority
(1977).
enty-five
statutory grants of
126 U.Pa.L.Rev.
303 & n.104
Berger,
award an
Court Award-
fee.
Attorney Type
Rate
Total
party seeking
ultimately
the fee did not
of Work Hours
&
prevail.18
ap-
Court
Partner:
Senior
$1,643.50
pearances
$95
17.3
point
computation,
At this
the Dis-
Partner: Reviewof
Senior
Judge might usefully
$3,332.00
trict
construct a table
pleadings
$85
39.2
Junior Associate: Research
something
example.
looks
like this
$3,504.00
drafting
$40
87.6
&
Attorney Type&
of Work
Hours
Deposi-
Junior Associate:
$1,420.00
$40
35.5
tions
Appearances
Partner:
Senior
Court
17.3
$9,899.50
pleadings
Partner: Review of
Senior
39.2
drafting
Junior Associate: Research &
87.6
*12
Thus, the
hypotheti-
“lodestar” fee in this
Depositions
Junior Associate:
35.5
$9,899.50.
cal is
Hourly
2. A Reasonable
Rate
remaining
The
element
in fixing a “lode-
Adjustments
to the “Lodestar”
B.
hourly
star” fee is the reasonable
rate.
may
adjusted
The “lodestar” fee
be
The
hourly
reasonable
rate is that
to reflect other factors. We discuss herein
prevailing
community
in the
for similar
applicable
those
in Title VII and similar
work.19 As we
hourly
noted a reasonable
fee-setting
justify
cases.22
burden of
product
rate is the
multiplicity
of a
of fac
ing any deviation from the “lodestar” rests
tors. Evans itself listed several of the rele
on the party proposing the deviation. Lin
II,
dy
reputation,
undesirability
and the
VII,
Under
only
statutes
like Title
Evans,
case. See
It is
the eventual
adjustment
designed solely
tingency
money
ient of the value of the use of the
compensate
possibility
meantime,
use,
for the
at the outset
which
particularly in an
unsuccessful
era,
would be
inflationary
percentage
is valuable. A
obtained. Contin-
and that no fee would be
adjustment
delay
receipt
to reflect the
adjustments
entirely
of this sort are
gency
payment
appropriate.
therefore
“contingent
arrange-
fee”
unrelated
II,
Lindy
Lindy
permits
adjustment
then
“lodestar”-up
or down-based on the
Ill
performance of
all-around
counsel
II,
Copeland
Copeland
I and
how
specific
“Any
case:
increase or decrease
ever,
entirely
took an
different view from
adjust
quality'of
in fees to
for the
work is
that expressed
opinion.
in this
The fee
designed to take account of an unusual
approach we have described rests on com
skill,
degree
it unusually poor
pensating
for the market value of
unusually good.”
895
2000e-5(k) (1976)-
bring
employment
ees must
their
(emphasis
first
42 U.S.C. §
added).25
not to an
grievances,
discrimination
inde-
pendent
local administrative
state
of the statute indicates
language
The
EEOC,
body
very
or to
agency
but
fee
should not
the calculation
they are
practices
complain-
about whose
vary
identity
losing
defend-
with the
ing.
ant,
underlying
policies
the attor-
and the
fully
ney’s
provision
(footnotes omitted).
are
consistent with
fee
331
Id. at
plain
policies,
Those
as we
language.
this
A second
underlies fee
policy also
awards.
seen,
primary purpose
have
are two.
noted,
prospect
we have
of liability
As
competent
obtain
counsel
help persons
help
attorney’s
for an
deter dis-
rights through
with
to vindicate civil
which
thereby
litiga-
crimination26 and
obviate
Park,
litigation.
g., Piggie
E.
390
U.S.
tion. We
think that
do not
incentive
402,
Nothing in
at 966.
the statute
88 S.Ct.
government
to refrain from discrim-
suggests that
the incentive
ferret out
private
any
ination
less than for
should be
discrimination, provided by
prospect
employers.
fee,
an
should be
less when
Finally, we
that various courts
note
government
any-
is the defendant.
If
expressed views consistent
those we
important
thing,
provide
more
it is even
express
example,
age
today. For
adequate
employment
fees to
discrimination
City
against the
discrimination suit
Phil-
litigants
against
prevail
govern-
who
adelphia,
Appeals
Third
Court
Califano,
ment.
Parker v.
F.2d 320
561
Circuit observed:
(D.C.
1977),
court
observed that
Cir.
City
The fact
of Philadelphia’s
against
Title
litigants
government
VII
pay
tax
revenues must
fees award
greater
litigants
face
than
obstacles
does
special
not warrant
standards for
noted:
private defendants. We
public
private employers.
rea-
employees,
sector
Unlike
federal
sonable
time
value of an
does
employee complainants
merely
not
depend
or her adversary
on who his
private attorneys general;
they are the
is.
general under
the enforce-
1231,
Rodriguez
Taylor,
569 F.2d
adopted
ment scheme
Section
(3d
denied,
1977),
n.32
cert.
1975).
V
U.S.
(Supp.
U.S.C.
2000e-16
Suits
§
(1978);
ther when nor calculated II, 116. We fear Lindy 540 F.2d at that the government. is the losing defendant proposed “cost-plus” calculating method of inquiry fees would become the indeed Ap- B. Difficulties with “Cost-Plus” that we proportions” “massive strive to proach problems avoid. The associated with ad- opinions event panel ministering “cost-plus” calculus a are mul- suggested “cost-plus” method of might tifarious. How a firm allocate its calculating usefully applied might particular piece overhead costs to a liti- cases, of the regardless identity all of the gation? one In what manner does calculate II, Copeland slip op. defendant. See “imputed with the costs associated sala- brief, opinions, panel 18-19. The partners? ries” of firm What is a “reasona- should thought that a fee be based on “the profit ble” The necessity, to be awarded?28 paid attorneys personal sums out to answering under “cost-plus,” [the] these and defray income and to overhead costs attrib questions specter other creates of a utable to the maintenance of the on an inquiry wholly monumental issue an- firm,” plus in the “reasonable and control cillary of the to the substance lawsuit. I, margin Copeland lable profit.” these, To like questions address consider- F.2d at 251. discovery necessary able would obtain think, however, We that the standards we A law documentary evidence. firm’s finan- opinion discussed earlier in are those cial highly structure is relevant to a “cost- govern fee-setting that should all cases un- plus” inquiry, firm’s financial so the records “lodestar,” der the statute. The or “market Third-party would be discoverable. value,” setting method of fee has the virtue expert testimony prof- would have to be being easy relatively to administer. We spent litigating fered. Because time do not want request compensable,29 is itself court, depth setting inquiry ironically might district an attorneys’ lead
fee,
increase,
diminution,
in a
an
become enmeshed
meticulous
rather than
in fee
[to]
analysis
every
detailed facet of
awards.30
Indeed,
concept
profit”
court
distinctions
consider
between the
of a “reasonable
private plaintiffs
anomaly
applied
nonprofit
Commission
is
deter-
to a
civil
when
mining
rights organization.
compre-
reasonableness
Commis-
It is difficult
efforts,
grounds
profit
sion’s
we find no
hend how a
is to be calcu-
“reasonable”
lated,
applying
general
nothing
organiza-
a different
standard
because there
plain-
losing
experience
compare
whenever
the Commission
tion’s
which to
it.
tiff.
EEOC,
Christiansburg
Co. v.
Miss.,
Garment
U.S.
g.,
29. E.
State of
Johnson v.
606 F.2d
*16
412,
694, 700-01,
n.20,
635,
Maher,
422-23
98 S.Ct.
54
1979);
(5th
Gagne
637-39
Cir.
added).
(1978) (emphasis
L.Ed.2d 648
The
336,
aff’d,
Su-
(2d Cir.),
594 F.2d
343-44
448 U.S.
preme
goal
122,
2570,
Court also has said that
of
(1980);
100
65
S.Ct.
L.Ed.2d 653
extending
employees
Affleck,
75,
to cover
Title VII
federal
(1st
Lund v.
587 F.2d
77
1978).
nonstatutory
In
in
cases
which a
“
to eradicate
‘entrenched discrimination in
sought
fee is
out of
“common fund” earned
”
service,’
by according
the Federal
...
spent
group
plaintiffs,
litigating
for a
time
“Mggrieved
employees
.. . the full
compensable. Lindy
[federal]
fee issue
rights
granted
II,
110-11;
in the courts as are
available
540 F.2d at
see note 57 infra.
in
sector under
individuals
title
VII.”
recently
judge
30.
awarded
One district court
Roudebush,
840, 841,
Chandler v.
425 U.S.
96
$5,000
approximately
in additional fees for time
1949, 1950,
(1977) (empha-
S.Ct.
897 statutory an authority, sence of award enduring inquiry prospect prevailing party.31 discourage competent fee to the scope might this undertaking repre- ap- Title VII with Congress understood —and noted counsel from cannot be possibility This sentation at all. in the Title VII context courts proval —that purpose “to light of Title VIPs in approach tolerated a “market value” used by . .. dis- injured encourage individuals According to the award of fees. Senate Piggie judicial relief.” to seek Act, crimination the 1976 Report accompanying 402, Park, 88 at 966. S.Ct. 390 U.S. “appropriate stan- approach provides the 1011, awarding S.Rep. No. for fees. dards” system poses con- sum, “cost-plus” (1976), Cong., 2d Sess. 6 U.S.Code 94th But difficulties. administrative siderable 1976, p. 5908. Cong. Admin.News See & depend does not rejection of its thesis our 1558, Cong., 94th 2d 8 & H.R.Rep. No. Sess. inconvenience alone. We on administrative (1976), Cong. n.16 & Admin.News U.S.Code “cost-plus” is the theoretical basis of think 1976, p. 5908. Congress’ fundamentally inconsistent statutory for fee- purpose providing in ignore Congress’ Even if we were free based on the shifting. A fee should be intent, see no reason now to abandon we rendered, not on value of services market approach to fee calcula- the “market value” law “cost” incurred some notion of “cost-plus.” In the instant tion favor of conclusion both of the firm. That is the example, nothing the record issue, spoken on the courts that have pre- suggests “cost-plus” would be a itself. Congress also setting method of fees. The ferable seen, attempting to As we have courts along all government’s primary contention Congress’ wishes have taken as faithful simply many too in this case has been starting point in fee calculation by plaintiff’s attorneys. spent hours were multiplied by the hourly rate prevailing judge agreed that too The District Court reasonably expended. An number of hours spent, indeed been and he much time had manner is ade- amount calculated in that accordingly.32 award requested reduced the competent counsel to under- quate to entice fraught with con- panel opinions representation. take many spent hours were on this cern that too case; however, nothing ironically, principle of- Courts had articulated this effective than ten, Congress passed “cost-plus” scheme is more consistently, when reducing approach in Rights Attorney’s Fees Awards the “market value” the Civil hours. As 1976, (1976). fee to reflect such wasted Act 42 1988 That U.S.C. § “cost-plus” in government recognizes, passed Supreme Act was in the wake of the setting simply a new method Alyeska Pipeline effect Court’s decision Service 240, Nothing in it is compensation.33 rate Society, v. Wilderness 421 95 the Co. U.S. judges determining (1975), 141 which of value to trial 44 L.Ed.2d S.Ct. properly spent.34 ability, in the the number of hours sharply restricted courts’ ab- n.9, 2024, 2034, 447 U.S. 70 100 S.Ct. 64 If this excessive for amount is considered (1980); Hampton, solely Hanrahan v. services rendered in connection with a L.Ed.2d 723 n.4, 1987, 1989, request, that a substan- 100 S.Ct. it should be noted U.S. (1980). part tial this cost is attributable to the L.Ed.2d 670 evidentiary require- procedural extensive supra. opinion p. See 888 of attorneys’ fees im- ments for court-awarded posed by Copeland opinion .... [I] Response Memorandum of United States Pertschuk, Empl.Prac.Dec. Bachman v. 6500, Rehearing Request for Its Views on to Court’s (D.D.C.1979), appeal pending, 6512 n.5 Memoran- En Banc at 2-3 cited as [hereinafter (D.C.Cir.). No. 79-1650 dum United States ]. *17 permits 31. The 1976 Act court-awarded fees Indeed, panel’s prevailing party rights new to the extent that in certain civil suits. question approach patterned all relevant to the the 1964 Act’s is at That Act was after panel’s expended, fee-shifting provision, this case the number of hours under which Club, govern- Carey, practice Gaslight calls to mind the Inc. v. scheme arises. New York 898 fundamentally, nothing panel any amount,
More in the because such by almost defini- case, tion, opinions explains why, typical in the provided attorneys the same com- pressures pensation rates established they normally that received. II, market will differ from Copeland 14, think, mechanism those slip op. at 15. We resulting “cost-plus.”35 nevertheless, under If “cost- that proper focus is the plus” simply reaching rendered, another method of market value of regard- services the same result as under “market value” less of the notion of panel “costs” that calculations, the added administrative bur- important. seemed to think so den seems not worth the candle. On the We thought should have this issue re- hand, “cost-plus” pro- other if somehow solved in this circuit as far back as the duces obtaining different results from those seminal decision in Evans. In we calculations, under “market value” “cost- agreed with the Fifth the appli- Circuit that plus” is inconsistent with the wishes of Con- cable prevailing rate was that “for similar gress overwhelming and the view of courts Johnson, work community.” in the that have considered matter. 718; Evans, F.2d at see at 503 F.2d 187-88. The one circumstance in which “cost- Nowhere in or Evans are salaries Johnson plus” certainly yield almost will a different mentioned as relevant to the calculus. Moreover, fee from that under “market value” is this court en banc had earlier plaintiff where the repre- explained: successful “public sented interest” law firm. It may well organi- be that counsel serve groups represent Such often their clients zations like appellants compensation for fees, for low or for no fee at all. Conse- below that obtainable in the market be- quently, attorneys individual at those they cause organizations believe the fur- organizations typically compensated public ther a Litigation interest. of this rates far prevailing below those in the mar- sort rely should not have to on the charity calculations, ketplace. “Cost-plus” focus- of counsel .... who ing they lawyers’ as do on salaries rather worked on this case should be reimbursed rendered, than on the value of services the reasonable value of their services yield instance will fee lower awards than those under a system. “market value” Morton, Wilderness Society v. 495 F.2d
Copeland 1026, II argued (1974), this result was grounds rev’d on other entirely opinion pointed reasonable. The Alyeska Pipeline sub nom. Co. v. Service out fee-setting that a 240, mechanism that Society, Wilderness 421 U.S. 95 S.Ct. costs, plus awarded a its (1975); accord, firm a reasonable 44 L.Ed.2d 141 Nation profit, could penurious Nixon, not be condemned as al Treasury Employees Union obtaining “cost-plus” approach ment expected contractors of con- “market value” would be practice,
tracts for services proffered hourly rendered. That prevail reduce the rate to that panel recognized, itself has been criticized marketplace. increasing by removing for costs the incentive efficiency. II, Copeland slip op. assume, panel opinions at 7. 35. The seem to but explain, why approach may prevailing hourly nowhere “market value” more e., “cost-plus” reducing community effective than rate in inflated rates established —i. requests Consider, pressures for another reason. of the market mechanism —is example, requesting a defendant light oft-reported fees from a glut unreasonable. losing plaintiff under the doctrine of lawyers, Christians particular it cannot be said that EEOC, burg Garment Co. v. 434 U.S. purveyor enjoys monopoly services (1978). Suppose S.Ct. 54 L.Ed.2d 648 power artificially with which to raise rates to prevailing requested counsel for the defendant yield profit. more than a “reasonable” Certain that, although accurately a fee based on rates “prestigious” charge of the more firms do rates costs, reflecting grossly pre its exceeded the higher practition- than those of other firms vailing judge applying market A rate. services, ers. Clients nonetheless seek their “cost-plus” formula would endorse the any monopoly power enjoyed by not because of requested fee, “cost-plus” essentially because firm, but because the clients believe accepts at face value the law firm’s actual expense. the services rendered warrant hand, judge applying costs. On the other
899 Indeed, 1558, 1975). private (D.C.Cir. H.R.Rep. to bar. See No. 94th 317, 322-23 F.2d (1976), attor Cong., value of an 2d 8 n. 16 and cases the reasonable Sess. appraise cited therein. time ney’s salary levels is to absolute Second, legislative purpose [r]eference of deriving the rea- as reasonable about Rights scheme of the Act of 1964 will Civil judge’s time of a federal sonable value by computing served fees based on a salary. her from his or approach. purpose “market value” as we provision, Title VIPs fee award have 1231, 1248(3d F.2d Rodriguez Taylor, 569 seen, encourage private is to enforce- denied, 913, 98 1977), cert. 436 U.S. Cir. rights While some ment of the civil laws. (1978). 414 56 L.Ed.2d S.Ct. private lawyers would assist in the enforce- panel precedent, this Despite fee, VII for a reduced ment Title Con- value of opinions contended that market gress recognized payment has of full should be irrelevant. Be expended time provide greater will enforcement in- fees the fee award is to purpose cause the public interest centives. Full fee awards incentive to counsel provide a sufficient work, help law firms finance their both in plus based on “cost rea litigate, a formula Indeed, the instant and in others. guarantee [public inter profit will sonable proven discriminators) may (paid by awards will be at practitioners] a return that est help (paid reduce the subsidies from the usual equal to that received in their least fisc) organizations of these public that some II, (em slip op. at practice.” Copeland receive. Thus, panel correct phasis original). Third, differently de- paying compute low-salaried attor ly concluded normally identity market rate of the successful neys prevailing pending to which result in two yield larger plaintiff’s attorney might will fee than they are accustomed. The in- kinds of windfalls to defendants. employers not to discriminate is centive reasons, we see this as no variety For a reduced if diminished fee awards are as- First, Congress has indicated flaw. sessed when discrimination is established. lawyers in these sorts of public interest Moreover, interest law firm public where a by using a compensated cases should (a plaintiff’s law firm serves as counsel approach. The Senate Judici market value that, panel’s approach, will not under Committee, report endorsing in its ary of its services from the obtain the full value act, draws no distinction 1976 fees defendant) losing the defendant will be sub- public interest law awarding fees between ject incentive to settle a suit to a lesser private attorneys. S.Rep. No. firms and if litigation without than would be the case (1976). Cong., 2d 6 That 94th Sess. plain- firm undertook high-priced County Davis v. report approval cites with Chang, Dennis v. representation. tiff’s (C.D. Empl.Prac.Dec. Angeles, of Los (9th 1980). That is so F.2d in which the Cal.1974), a Title VII case marginal cost of each hour because court said: be reduced. De- continued would legally plaintiffs’ relevant that is not [I]t plain- could inundate the fendant’s counsel employed by the Center counsel ... without discovery requests tiff with fear Interest, private- for Law In The Public legal resources paying the full value of the public interest law ly non-profit funded not think that response. wasted in We do public It is in the interest of firm. VII that defendants should Title intended awarded reasona- that such law firms be imprudently litigate incentive computed in the attorneys’ ble fees to be fortuity of the identi- simply because of the manner .... traditional ty plaintiff’s counsel. Report House Similarly, Id. at 5048-49. Fourth, majority of note that the vast we said awards of endorsed other cases that issue considered courts that have rights law firms should be fees to civil attorney’s fees should with us that equal agrees awarded to members of the to those *19 900 Torres,
not be based on the costs of the successful
supra,
both
highly
cited
rele-
party.
Instead, fees should be based on the
vant also to the calculation of the fee. The
market value of the
services rendered.
opinion
Torres,
Second Circuit
for exam-
Ehrlich,
(8th
Oldham v.
at 168-169
Cir.
ple, stated:
12, 1980); Palmigiano
March
v. Garrahy, at
Litigation to
the law’s protection
secure
(1st
1980);
599-603
Cir.
Dennis
Chang,
v.
has frequently depended on the exertions
1302, 1309(9th
1980);
611 F.2d
Cir.
v.
Carey
organizations
dedicated to the enforce-
Club, Inc.,
New
Gaslight
York
598 F.2d
ment of the
Rights
Civil
Acts.
agree
We
1253, 1255
(2d
1979), aff’d,
n. 1
Cir.
447 U.S.
with the Courts which have held that
54,
2024,
(1980);
100 S.Ct.
We also
fees” from the losing
Keyes
defendant.
v.
suggested
petition
certiorari,
1,
393,
School Dist.
F.Supp.
No.
439
406-07
respondent’s
representation
(D.Colo.1977)
(emphasis in original);
see
public
group
“special
interest
is a
circum- National Treasury Employees Union v. Nix
on,
stance” that should result
in denial
317,
(D.C.
1975),
521 F.2d
322-23
Cir.
counsel fees. Federal
Appeals’
Courts of
quoting
Morton,
Society
Wilderness
495
See,
decisions
contrary.
are to the
g.,
e.
1026,
(D.C.
F.2d
1974) (en banc).
1037
Cir.
Reynolds v. Coomey,
(1st
L.Ed.2d 723 passage This signifi- preceding explication proper cant not for its discussion of public criteria for awarding per- interest lawyer’s entitlement vel non to a mits us now to consider the District Court’s fee; approving Reynolds reference to award this case. government
36. The
lawyers
itself states:
such firms and
receive fee
equal
awards
to those made to firms and
[public
[F]ees
these
interest
firms
law]
large.
should not be less than would be the case
States,
supra
Memorandum of United
note
for-profit
brought
had a
law firm
the suit.
at 4-5.
Strong
public policy require
considerations of
precisely conform
Scope
procedures
A.
of Review
identi-
upon
fied in earlier cases and elaborated
learning that an at
It is common
believe,
opinion.40
however,
We do not
torney’s
fee award
the District Court
productive
that it would be
now to remand
appeal only
represents
if it
upset
will be
computations.
this case for new
It was
*20
We customarily
an abuse of discretion.37
years ago
more than seven
that Dolores
judgment
to the District Court’s
be
defer
Copeland alleged
gender
discrimination
an
is not well situated
appellate
cause
court
in this lawsuit.41 This very
resulted
to assess the course of
and the
opinion, regretably,
clarity
must be
quality
The District Court
of counsel.
However,
Copeland
identified as
III.
contrast, closely monitors the liti
judge, by
protracted litigation finally
end of this
is in
gation
day-to-day
on a
basis. The Su
sight,
unnecessarily
and we do not wish
to
preme
long ago observed that a trial
Court
prolong
only remaining
it when the
issue is
judge
knowing
means of
“has far better
that of
fee. The Court of
just
appel
than an
what is
and reasonable
Circuit,
banc,
Appeals for the Third
en
com-
v.
late court can have.” Trustees
Gree
situation;
mented in a similar fee-award
527, 537,
nough, 105
Other circuit courts of
have ob-
pay
an itemization of the back
awards
obtained
the lawsuit.
appellate judges
served that
are themselves
experts
assessing
the reasonableness of
rate,
average hourly
weighted
for the
award,43
ap-
and that the
spent by
attorney,
number
hours
each
court,
pellate
pinch, may independently
in a
fee,
computed
A “lodestar”
$57.17.
record,44
3,602
review the
or itself set the
multiplying
spent,
fee.45
hours
$57.17
$205,916.50.
would be
Our own examination of the fee award in
properly
The District
inquired
Court
this case leads
that the
us
believe
award
reasonable,
whether that
rate was
fully justifiable
and that affirmance of
and whether all the hours were reasonably
award,
special
under
circumstances
*21
that,
expended.
although
It found
the rate
case,
inappro-
of this
therefore would not be
reasonable,
was indeed
some of the hours
priate.46 Accordingly, we affirm.
nonproductive.
were
The District Court
noted
obviously
that “the firm has
made
1. Calculation of the “Lodestar"
little,
any,
if
effort to
billing judg-
exercise
ment ....
practically
part-
no
[TJhere
attorneys
Plaintiff’s
submitted the fol-
expended
ner time
on this case and the
lowing
documenting
materials
their fee re-
associates lacked experienced trial di-
quest:
rection.”
(1)
reviewing
history
memorandum
analysis
With this
we can find no fault.
of the litigation;
myriad attorney’s
Our review of
fee cases
(2)
revealing
they spent
affidavits
average
demonstrates that the
hourly
$57
3,602
case;
on
hours
certainly
rate
is within the bounds of reas
(3)
revealing
statistics
the firm’s
think, also,
onableness.47 We
that the Dis
hourly
normal
rates for these
properly
compensation
trict Court
refused
ranged
per
from about
hour
$52
to about
nonproductive
for
hours. Hours may be
hour;
per
$90
nonproductive
disallowed as
for at least two
(4) a
Lawyers’
letter from the
Committee
First,
compensation
reasons.
no
should be
Rights
for
Law stating
Civil
Under
given
spent litigating
for hours
upon
issues
typical
charged by
large
Wash- which plaintiff
prevail.48
did not ultimately
ington firms
employment
discrimina- Also not allowable are
simply
hours that
See,
g.,
Ferry, Inc.,
spent
43.
e.
Although
In re TMT Trailer
577
time
on out-of-court work.
1296,
(5th
1978);
F.2d
1304
Cir.
Inv.
practice may
B-M-G
this
cumstances,
be desirable under some cir
Gordin, Inc.,
Co. v.
Continental/Moss
437 F.2d
opinion
see section II-A-2 of this
892,
(5th Cir.),
denied,
989,
893
cert.
402 U.S.
supra,
using
single hourly
we do not think
1668,
(1971).
91 S.Ct.
pleadings; P & .... conceded, settled, that it eventually remand; A’s; MOTION of defts. to P & many of the important issues before trial. judgment stipulation, concession,
That is by OPPOSITION defts. to motion for cer- normally or consent decree is irrelevant to tification .... the entitlement vel non to an attorney’s fee,54 by pltffs MEMORANDUM relating to and in this case it also is irrelevant to defts destruction documents .... “develop calculation fee. Where [of] apparent ments made it that the judge POST-HEARING brief defts in was oppo- pltffs sition to claim for about pro- complainant,” retroactive rule for the a de motion and pay; back .... hope fendant cannot to ameliorate the bur- government argues Frank, 1213, 52. The (5th now also that too 53. Wolf v. 555 F.2d 1217 Cir. many spent 1977) (“Obviously, hours op were because the case was the more stubborn the credible; complex. position This required” by assertion is not the more time would be government side); itself in the District Court the other Perkins v. New Orleans Athlet “extreme[ly] Club, complex[].” 661, called the case F.Supp. (E.D.La.1976) See ic 429 667 p. (“Those opinion government, 886 supra. who elect a militant defense ... [are this responsible they the time and effort for] exact retrospect, in considered the case to be un- opponents”). from their complicated. repeat history We need not long rocky of the case. The road which 127, 122, Gagne, 448 100 54. Maher v. U.S. support we have described does not charac- 2570, 2573, (1980). S.Ct. 65 terizing simple. L.Ed.2d 653 See it as Edwards, Rainey also Iranian 672, Students Ass’n v. 604 College, v. Jackson State 551 F.2d 352, (5th 1979); Sargeant (5th F.2d 353 1977). Cir. v. 677 Cir. 645, Sharp, (1st 1978). 579 F.2d 647 n.3 Cir.
905
by making
Specifically,
den of
fee
elev-
the government
that
asserts
Rumsfeld,
concessions.
v.
enth-hour
Cuneo
in awarding
District Court erred
fee
1360, 1362,
(D.C.Cir.1977).
F.2d
1364
553
because
it had before it affidavits that
starting point
setting
Because
roughly
spent.
the hours
itemized
The Dis-
attorney’s fee is the “lodestar”-hours
rea-
trict
origi-
Court
have
should
consulted the
sonably spent multiplied by a reasonably
firm,
logs
nal time
kept
we
told.
are
hourly rate-a last-ditch concession does not
occasion,
may,
necessary
on
compensation
spent
hours
prevent
liti-
for the
origi
District Court
examine the
gating before the
was
concession
offered.
nal time
Pete v.
logs.
UMW
See
Welfare &
brief,
appellate
govern
In its
Fund,
1275,
(D.C.
Retirement
F.2d
517
1292
argues
litiga
ment
that
its
version
Cir.1975) (en
case, however,
banc).
In this
have
portrayed
fully
tion would
been
more
there
allegation
is no
that
the affidavits
the District
if
Court had conducted
hear
summarizing
logs
time
re
ing on the issue of the
Such a hearing
fee.
spect
Moreover, although
inaccurate.59
may
in some circumstances
be useful.55 In
plaintiff’s attorneys apparently were will
case, however,
the District Court ruled
produce
logs,60
time
the govern
question
witnessing
on the fee
after
ment
requested
they
never
do so. Nor
of the entire
and with
conduct
government
object
did the
ever
Dis
benefit of substantial briefs
from both
trict Court that the itemization of the hours
We cannot
failure
say
sides.56
to hold
any respect
deficient. We think
hearing
under these circumstances was
objections
documentation,
re
like
Moreover,
government
error.57
never
quests
evidentiary
hearings, must be
asking
elementary step
took
the Dis
Court;
cannot,
made to the District
one
hearing.58
trict Court to
We
hold
think
after receiving an unfavorable ruling from
“having sought
hearing
on
no
[the
objections
the trial judge, concoct
for use
motion, counsel could hardly
fee]
appeal.
surprised
have been
none
when
was held.”
Sullivan,
63,
(1st
v.
Kargman
F.2d
67
589
Adjustments
to the “Lodestar”
1978).
Cir.
A
government
adjusted,
“lodestar”
we
next contends that
fee
request
seen,
was inadequately
compensate
possible
documented.
for the
g.,
Sweeny Indep.
bounty.
generally Boeing
55. E.
Harkless v.
School
division of the
See
Dist.,
594,
(5th
1979);
Gemert,
472,
608 F.2d
597
Cir.
Sar-
Co.
v. Van
U.S.
100 S.Ct.
(1st
geant
Sharp,
v.
646-47
F.2d
Cir.
(1980).
907
significant training op-
Copeland II, slip op.
plan provides
The
standards.”
at 20.
women, including
(emphasis
original).
in
portunities for
accelerat-
management positions. It
training
ed
disagree.
litigation
We
That this
requires
assignments
that
be made on
work
sought
equitable
and obtained substantial
nondiscriminatory
It
basis.
also establish-
highly
the
relief is
relevant to
award of a
timetables,
goals,,
report-
an
es
and
annual
the
large fee. We have noted that
primary
ing
the
system to measure
Directorate’s purpose
provision
give per
of the fee
is to
past
progress
remedying
in
the effects of
by
sons victimized
discrimination the re
discrimination.66
rights
through
sources
vindicate their
produced intangi-
Plaintiff’s efforts also
Where,
here,
litigation.
as
the relief sought
flow
ble benefits that
from the elimination
generally nonmonetary,
is
a substantial fee
longer
of discrimination. Since women no
particularly important
is
that statutory
if
should be
advancement
of
denied
because
is
purpose
to be fulfilled.
is relatively
gender,
their
sense
inferiority
of
result-
easy
competent
to obtain
counsel when the
ing from the
will be elimina-
discrimination
litigation
likely
produce
is
a substantial
Moreover,
exposure
ted.67
discrimi-
of
monetary award.
It is more difficult to
Department
nation in
of the
portion
one
sought
attract counsel where
relief
is
of,
heightened
Labor
lead to
awareness
nonmonetary.
reason,
this
primarily
For
eradicate,
and
possibly
intensified efforts to
in
produce
fee awards
cases that
substantial
discriminatory
throughout
treatment
the nonmonetary
benefits must
be reduced
Department.
produced
simply
litigation
because
little
Appeals
The
cash.68
Court of
for the
insists, nevertheless,
The government
approved
of a
payment
Second Circuit
sub
that the
of a
monetary
absence
substantial
where,
here,
stantial fee
preclude
recovery ought to
a fee
award
the order
magnitude
given
sought
that
obtained
plaintiff
broad
[t]he
District
panel agreed,
Court. The
conclud-
equitable
[per-
relief which will benefit
$160,000
that
plaintiff.
the existence of a
fee to
in addition to the
Al-
sons]
$33,000
obtain
pay
about
back
establishes
though
group
size of the
affected
“at
prima
something
large,
least a
facie case
litigation may
that
not be
the claim
wrong
previously
significant
rights.
with the
constructed
involved
federal
Be-
Maher,
government
336,
Gagne
(2d Cir.),
66. The
v.
contends that it offered vol-
594
341
F.2d
untarily
aff'd,
122,
2570,
plaintiff
much
the relief that
obtain-
U.S.
448
100
65
S.Ct.
L.Ed.2d
government points
adopt-
(1980).
ed. The
out that the
653
plan
basically
ed affirmative
was
action
Sweeny Indep.
Dist.,
sum,
proposed by
Secretary
School
Cf. Harkless
of Labor.
594,
1979)
(5th
government
(discussing
denigrates
plain-
608 F.2d
Cir.
efforts
professional
equitable
vindicating
bringing
tiffs
value
one’s
sta-
counsel
about
tus).
think,
though,
relief we have described. We
plaintiff’s
lawsuit
plaintiffs
attorneys’
If
had to
own
bear their
catalyst
prompted
acted as a
which
the [em-
injunctive
ag-
fees in a suit for
relief “few
ployer]
implementing
action
to take
its own
grieved parties
position
would be in
to ad-
employment policies
seeking compli-
fair
public
by invoking
vance
interest
the in-
requirements
ance with
VII.
of Title
junctive powers
Co.,
courts."
federal
Parham v. Southwestern Bell
Tel.
F.2d
Lines,
387,
421,
Sprogis
(8th
1970).
Indeed,
v. United Air
517 F.2d
papers
429-30
Cir.
(7th
1975),
Court,
quoting
Piggie
n.5
government
Newman v.
filed in the District
itself
Inc.,
400,
Enterprises,
Copeland
Park
390 U.S.
lauded “the service rendered
Mrs.
964, 966,
(1968).
Department
pointing
S.Ct.
It is so ordered.
junior
associates,
particular
or these
associ-
MacKINNON,
they
whether
Judge.
ates. The issue is not
shall be
Circuit
paid;
prevailing party,
as
for the
join
opinion.
my
in the court’s
view
I
paid.
are
they
rightly entitled to
cost-plus
value and
both the market
not,
level,
appellate
issue is
this
even
lead
can at
times
to exorbitant
standard
paid.
how
The issue
they
much
shall
fees;
approach
I view the market value
but
unfortunately
simply-
here is
only-but
as
hence easi-
being more time honored and
which these
formula
application
er
nationwide where all law-
should
the trial court.
be calculated
yers
over-
keep
do not
detailed records of
question
required
This
much time and
expenditures.
and other relevant
has
head costs
attempt
part
effort on the
of this court
The bench and the bar
accustomed
should have come
representing
area
to resolve. All members
market value in the
fact, as
ana-
grips
the obvious
we
fees and I believe
reasonable
standard,
lyzed
particular
properly applied,
when
in-
dissected
Not to be confused with the motto
Force,
Royal
Per
Ad
Air
Ardua
Canadian
Astra.
*27
field,
precedents
previous
even in our
Outline of Opinion
circuit,
own
contradictory,
rested on
over-
Page
disharmonious,
lapping,
spurious
even
A. Past Precedents in This
Circuit_______909
B. Result When Past Precedents Applied
irrelevant “factors.” This incoherent me-
to Copeland______________________910
lange provides no consistent rationale for a
C. How the
Fee Incentive
Attorney’s
Op-
judge
apply,
conscientious trial
at least in
Litigation______911
erates in Government
a case in which the Government is the pay-
D. Failure of
Fees to Deter Dis-
Attorney’s
defendant;
ing
the effort to do so here has
______912
crimination
the Government
highlighted
inadequacies
inapplica-
E. “Reasonable” Private and Government
bility
previous precedents.
Litiga-
Fees in Government
Attorney’s
_____________________________912
tion
Judge
opinion
majori-
McGowan’s
for the
Majority’s
F. “Market Value” Fee
ty is the most strenuous effort
pull
so far to
___________913
Where No Market Exists
basically
(even
incoherent rationale
if of
Legislative
G. The
Statute
His-
sector)
some
--------------
together,
service
tory
to smooth putty
visibly widening
into the
Majority
II. The
Anal-
Opinion
Faulty
Formula —
Produces
ysis
Results____________917
Skewed
logic
cracks of
and to cover
lacquer
with the
Contingency Factor___917
A. The Redundant
polished
of a
style. We in the dissent can-
Encouraging Injured
B.
Plaintiffs or En-
buy
product.
many
Over
months of
couraging Lawyers?________________920
pondering
arguments
for importing the
C.
Quality Representation___________921
market
value
rate fee
govern-
into
Majority
D.
Failure to
New Formula
Apply
litigation-this
ment Title VII
is the first
______________________922
to this Case
case in this circuit-we are more than ever
III.
“A Reasonable
Fee” —Actual Cost
Attorney’s
convinced that the market value
concept is
__
Plus a
Reasonable and Controllable Profit
market,
unworkable
where there is no true
A. The Need for
Additional
Guidelines for
_________________923
the District Court
apply
the effort to
it inevitably leads
B. Rationale ________________________924
excesses,
to distortions and
far away from
C. Application_______________________925
“reasonable
fee” which was
D. Substantive
Feared from the
Inequities
Congress’s only avowed standard
in-
_____________________926
New Method
tent.
1.
Problems with Small Firms
Special
First we
which,
delineate the differences
and Solo Practitioners
thoughtful
2. Similar Problems for the Public In-
analysis, are necessarily im-
Rights
terest and Civil
Bar
plicit in
setting
of a “reasonable attor-
Contingent
Fees
ney’s fee” according
statute,
where
4. Class Action Practitioners
the Government as contrasted with
pri-
Representing
5. Counsel
Poor Clients
party
vate
paying
is the
defendant and no
Generally
true market exists. Next we
up
take
Long
6. Counsel Who Work
Hours
applicability
obvious flaws in the
of Public Disclosure of
Requirement
majority’s private
theory
sector
to this case
Financial Information
of the Government as defendant-the redun-
Deterring
E. Fear of
Representation
___________________928
Title VII Cases
factor,
dant contingency
the care and feed-
I.
IN
DIFFERENCES
THE ROLE OF
lawyers
injured plain-
rather than
THE GOVERNMENTAND PRIVATE
tiffs, and the
testing
majori-
evasion of
PARTIES AS
IN TI-
DEFENDANTS
ty
Finally
formula
this case.
we describe
TLE VII LITIGATION
the actual
plus
cost
a reasonable and con-
profit
trollable
method of determining A. Past
Precedents
This Circuit
“reasonable
fee.”
The proper method for determination of
Outline of Opinion
attorney’s fees awards is a recent and de-
law,
veloping area of the
in which courts
Page
grasping
are still
for exact standards con-
I. Differences in the Role of the Government
sistent
congressional
intent. Over the
and Private Parties as Defendants in Title
past
years
half dozen
ad-
court has
Litigation________________________909
VII
*28
to
attempt
design
produce
must
to
them
fees
in several
issue
dressed the
eases,
attempting
case
fact situations
to
just
successive
results in various
each
modify
pre-
sometimes
systematize
logically apply
and
in the fu-
they
which
will
precedents.
vious
situations which arise in
specific
ture. The
bring
light
will sometimes
future cases
we
Park Hotel2
In Evans v. Sheraton
rules
general
in
laid down
deficiencies
included
listed
factors
should be
twelve
require
past,
greater
in the
will thus
and
appro
a
determination of
in
district court
modification
the stan-
cases.
elaboration or
fees in Title VII
priate attorney’s
were
from the
ease illustrates how
present
The
factors
taken
dards. The
twelve
in Johnson v. Geor
hourly
Fifth
decision
rate
application
Circuit’s
mechanical
in
Inc.3 which had
gia Highway Express,
formula,
appeared
which
advis-
times hours
guidelines
from
turn
the standards
drawn
cases,-
past
in
can
general
as
rule
able
the American Bar Associa
by
recommended
actually
entirely
unreasonable fees
lead to
Responsibility,
Professional
tion’s Code of
would
in
happen
out of line with what
Disciplinary
2-18 and
Ethical Consideration
private litigation.8
Rule 2-106.
The
effort
in this case con-
we
these
Huge4
In
v.
endorsed
Kiser
cerned a claim of
sex discrimination
taken from the Code of
same standards
twenty-four
brought by approximately
fe-
as
as the
Responsibility
well
Professional
of the Director-
employed
males
in branches
Litigation,
Complex
section
Manual
for
in the Department
ate of
Automation
Data
Work-
1.47.5
in Pete v. United Mine
And
discovery
Labor.
and nu-
The extensive
incorporated
ers6
we
pretrial
merous
motions in
case were
panel opinion in Kiser.
section of the
Depart-
whether the
directed at the issue
Treasury
National
Em-
opinion
Our
past
ment of Labor had discriminated
Nixon, summarizing
v.
ployees Union
against
plaintiff
assignments,
class
Huge,
pri-
analysis
Pete and
listed the
evaluations,
training,
promo-
performance
mary
hourly rate
factors for consideration:
tions,
working
compen-
conditions.
In
and
hours, adjusted
if
by
upward
multiplied
sation for
effects of discrimination
noncompensation
par-
there
risk of
or
is a
Department
found in
of Labor
adjusted upward
and
compensation,
tial
$31,345
pay
in back
for
paid
sum total of
quality
the basis of the
downward on
contrast,
In
plaintiffs.
thirteen
judged by the district
performed
work
by plaintiffs’ attorneys
fee requested
court.7
$206,000,
amount
was
and the
awarded
$160,000.
Plaintiffs’
the district court
Ap-
Past
B. Result When
Precedents
3,602
attorneys
spent
hours
the case.
plied
Copeland
gross disproportion between
Whether this
developing
In
area of the law such as
this,
plaintiffs’
claim and
setting
general principles
monetary
forth
stake
courts
per
(D.C.Cir.1974).
court
‘normal’
rate
2.
found that
hour
“[t]he
Though past cases in
including
sat,
unjust,
expanded litigation
those on
we
have
before
which
ourselves
doubles
given
triples
not
or
specific
poten-
quadruples
attention to these
or
the size of eventual
abuses,
tial
clearly
it is
to do
liability.
time
so now. Government
When
sector,
private
majority
has
monetary
the actual
validated
levels come to dwarf
deterrent
action
controversy,
present
punitive
as in the
U.
amount in
taxpayer.
these
is S.
incentives
the structure
magnified
deciding whether
further.
E.
Private and
“Reasonable"
Govern-
one,
like this
the Government
settle a case
Attorney’s
ment
Fees Government
considering
its case
primarily
is
whether
not
Litigation
risk an
strong enough
should
$31,345
in-
judgment
plaintiffs;
eventual
in a
operates
universe of
Government
stead,
rational
if
Government
prevailing
than that
fees lower
their
they
primarily consider whether
must
wealthy corporate
world of
clients.
much
strong enough
case
to risk the
pressing
If the Government were
the Title
$200,000
greater
plus
of a
even-
possibility
defending,
legal
VII case
than
rather
its
tual attorney’s fee award.
approximate
costs
“mar-
would
counsel,
ket value.” Government
Attorney’s
D.
Deter
Failure of
Fees to
side,
plaintiff
whether
or defendant
on the
by the
Discrimination
Government
never
traditionally simply have
been com-
*30
pensated
scale as
private
at the same
fees are meant to serve some
Attorney’s
practice.
young associate makes
The
purpose
deterring
They
discrimination.
slightly
young
than the
Government
more
private
But
doubtless do in the
sector.®
attorney;
margin
really
the
becomes
vast
attorney’s
straight
when
fees come
out of
partner
prestigious
when
in a
law
status
Treasury,
the
in the
United States
firm is
with the
compared
Attorney
even
present case,
no
they exert
deterrent effect
General of the United States. Since the
against
persons responsible
the
whatsoever
willy-nilly
financing
is
these
Government
private
for the
the
sec-
discrimination.
by plaintiffs
Title VII suits both
who suc-
punitive
justifiable
tor
a
element.
there is
(giving
ceed and
not
do
succeed
effect to
Attorney’s
impact
profit picture
fees
on the
factor),
contingency
Government counsel
the
corporation;
same executive
defending
plaintiffs’
bringing
counsel
and
responsible
management which is
for toler-
compensation
suits should
ating
encouraging
are the
discrimination
roughly
amplitude.
the same
responsible
same executives who are
for the
profit
penal-
so
corporation,
they
are
logical symmetry
There
princi-
is a
this
ized
pocketbook.
No such deterrence
ple.
as a
When the Government
defendant
Government,
e.,
i.
applies to the
the Labor prevails,
only
it has asked for and received
touched,
Department budget was never
will
costs,
its actual
of the attorneys
the salaries
touched, Judge
never
the award of
working
be
plus
the case
on
overhead costs
pay
Gesell in this case. Both
back
and
work-not
attributable to their
the market
the attorney’s
general
private
fee come out of the
going hourly
value
rate of the
sec-
taxpayer
undeniably
contributed funds of the U. S.
tor.9 It
litigation,
is
the same
Treasury. By
analogy
employees
their strict
vindicating
rights
discri-
Martinez,
totally
Copeland
colleagues
recognize
(D.C.Cir.
fail to
Our
And so we that if majority’s out ue,” Congress is anomalous where has pathway to the stars formula for complement specifically sought to the mar- applied is enough, may fees often there be a legal ket VII services in Title cases with popular government take em- demand to for allocating an alternative mechanism at- litigation ployee Title VII out of the court relying fees. torney’s Rather than on the system altogether limit employees and to parties privity-the client his or her administrative as previously. relief lawyer- agree among themselves to the now, As matters rendered, stand the Government value of services to Con- court, as defendant cost of law- a pays gress provided its own has trial in its that This legal private client. sector does discretion, assign burden of litigation against by every day. the winner In Title VII expenses incurred placed this burden loser. we have Government judge. last sen- points in this emphasized in- the substantial should underscore which, tence if recog- This is indeed a situation judicial de- market and congruity between complete- true is so proportions, nized in its legal services. of the cost of terminations private from it is ly different Furthermore, so well be- the market works concepts of the same market obvious effortlessly; invisibly, almost cause it works employed. Instead fees cannot be value judges only can the most astute of even play of the market of the free judge concept when the mock the market consenting we have clients the Government replicate market results where seeks to sued, financing litiga- all successful to be market, effec- Emulating the none exist. itself, financing all tion and also is, to the extent tive as it is worthless litigation against itself en- unsuccessful demand, agree- factors-supply and market If larged contingent fees on a basis. this is market-makers, prospective among ment done, to be it is what is what is marginal retrospective assessments concept majority’s done both then real. utility-are conjectural more ours, put entitled to then Government is then, attorney’s fees in plain, it is So on the regulations down some rules and cost assigned VII context cannot be the Title services, system legal which values because there according to market go- designed by statute the Government simply no for the quite buyers services If the totality. to finance Govern- agree Without who rendered. clients going to finance the whole mecha- ment rates, (bargained for) pay at certain there totality, concept of actual nism in then the missing an market. There is can be no plus profit cost reasonable attor- legal priori pecuniary relation between concept that can neys is about hold willingness services undertaken and fees down to a reasonable level. beneficiary There- pay for them. tendency abusively high toward fore, charging losing defendant for the real, yet majority in this sort of case is party’s expenses at “mar- prevailing *32 nothing to opinion absolutely cope offers rates which no one would ever have ket” there problem. with this We believe destroy the mar- voluntarily assumed is to try to ways indeed which we can solve concept by purporting respect to it. ket up problem, than throw our this rather majority’s inconsistency Another permit in attorney’s hands and fees Title compared approach “market value” when to to the stars. up VII cases continue Two regard with with bona fide markets is to in of these factors can found listed the be market, market, e., a i. a real risk risk. (1) a limiting Evans case: fees to level negative is a factor which diminishes the cases, in similar commensurate with awards beneficiary’s law- “expected value” the (2) limiting a level fees to commensu- client, the client. suit to A rational the controversy the rate with amount in services, beneficiary pay would less the Significantly, results obtained.11 ma- relatively litigation be- pursue to riskier jority opinion no mention these makes anticipated recovery cause his must dis- limiting precedents; ap- factors from our Naturally, lawyers counted for that risk. actually prefers parently majority the paid upon the only contingency who will be encourage legal upward toward fees the would demand appreciate of success We submit that “lodestar” were stars. Only premium risk for their services. fa¿ Congressional gaze when Con- market, course, from the could allocate true the lawyer specified attorney’s reasonable accurately gress burden of risk between “a Hotel, 11. See Evans v. Sheraton Park 503 F.2d (D.C.Cir.1974). 187-88
fee,”12 briefly the same private person.”15 so we now turn to what is as the The legislative history. language surely available of the statute does not approach; mandate a speci- market value it Legislative the G. The Statute and His- fies not at all the computing the method tory fee, only generally but instead directs that the “cost-plus” attorney’s The that the fee majority asserts should reasonable. “fundamentally formula is inconsistent asserts, however, The majority the that Congress’s providing in purpose with language “the States shall United be liable statutory fee-shifting.”13 majority private as a person” costs the same Congress further contends that intended plainly indicates the method that of calcula- a fee should be based on the market attorney’s tion of fee vary should not rendered.14 value of services Neither identity losing defendant. language nor the legisla- of the statute prove To is wrong that this we need not history underlying attorney’s tive fee dichotomy a clear between advocate congressional evinces a provision mandate calculating method of fees in the case approach to use the market value in calcu- which losing private defendant is a com- lating attorney’s fee reasonable award. pany losing and in the in which the case purpose underlying attorney’s fee defendant is the Government. The case encourage deserving litigants provision is to before losing us is one in which the defend- judicial seek To relief. effectuate this Government, ant is and we think that it Congress intended that the attor- purpose, well ap- the market illustrates how value ney’s fee awards be sufficient attract proach leads to an unreasonable result counsel, competent unreasonably but so be, type however, may of case. It produce as high a windfall for the attor- approach the market value would not be ney. quite position, simply, It is our inappropriate which a cases approach inappropriate the market value defendant, losing concern is the another at least in cases in which Government is case which we do not have before us. because, losing defendant will be analysis caveat, practi- Apart demonstrated our response from that our majority flaws in theory cal in Part II the majority’s is that contention we take below, presents the likelihood that statute language to mean reap attorney indeed will a bonanza. The that the shall also United States bear the formula, hand, “cost-plus” the other will burden of attorney’s “a reasonable fee” provide adequate compensation to enable when it losing is the defendant. The statu- litigants to competent obtain counsel with- tory language not indicate does providing attorney. out a windfall to the identical method of calculation shall be used in computing this fee-what be a rea- We begin by looking to the language of sonable calculating method of the statute. The pro- section *33 fee court, discretion, award in the in which pri- vides that “the its situation a may in vate entity ... is the prevailing party allow defendant be a total- reasonable costs, attorney’s ly fee part -as and the unreasonable method when the Govern- . .. United ment is losing States shall liable for costs defendant. recognize consequently upon
12. Further factors we should about it incumbent is less courts attorney’s Government VII are Title suits that the Govern- to administer the fees statutes with good policy against great federally ment’s faith and official liberality encourage order presumed; discrimination are to employed that plaintiffs sue. government employees already encouraged pursue to relatively their remedies virtue of their Maj. op. 13. at 897. protected employment more and thus privately need fear retaliation less than em- 14. Id potential ployed plaintiffs; that Government employees have administrative remedies short 2000e-5(k) (1976). 15. 42 U.S.C. § action; bringing a federal court and that that ing legislative history in the indicates attorney’s pro- fee also note that We Title itself to the details part Congress has been a even addressed above quoted vision the statute calculating the enactment of an award. VII since the method of time, majority indi- as the At that 1964. Rights Attorney’s regard to the Civil footnote, permit VII did not Title cates in 1976,19an Act similar in Award Act of Fee against suits discrimination employment attorney’s fee to the design principle were attorney’s fees Thus United States. VII, policy in Title provisions set forth against the Government awarded attorney’s provisions fee underlying the losing plain- was a when the Government fully: is elucidated more rights civil cases that a new was not until 1972 tiff. prevailing counsel “[Ajwarding allow to Title VII to provision was added partic- rights] litigation plaintiffs [civil The lan- against the Government. suits necessary if Federal ularly important section was not attorney’s fee guage of are to be ade- rights and constitutional civil rather, providing the new section changed; accomplish To protected.”20 quately government the federal for suits be awarded “to goal, reasonable fees must attorney’s provision fee indicated ... while avoid- competent counsel attract claims made applicable also be would majori- attorneys.” windfalls to reading of this employees.16 A fair federal correctly asserts that both the House and ty Congress not events is that did sequence of Rights to the 1976 Civil Reports the method of contemplate at all whether Senate calculating ap- reasonable fee should be Act cite with Attorney’s Fee Award losing in which the defend- same as the ease which the attor- proval Title VII cases in instead, entity; appears ant was a according mar- calculated to a ney’s fee was make clear Congress only intended to Congress found ket value formula. But also would be as- the United States the “fees in those cases cited [were] losing when it was a de- sessed for costs counsel, competent but adequate to attract fendant. windfalls to attor- produce [did] [the] neys.”22 Turning policies purposes provision set forth in attorney’s Congress We therefore that do not think VII, nothing we which would Title find value of the services intended the market approach. As the dictate a market value basis for an award of rendered to be the v. Supreme indicated in Newman Court technique fees when that would Inc.,17 Piggie Enterprises, provi Park produce a windfall or unreasonable fee. As fees in intended “to encour sion for counsel Georgia explained the court Johnson age injured by . . . discrimina individuals Inc.,23 Highway Express, one of the cases relief,” judicial by enabling tion to seek Congress approval: cited with adequate couns these individuals to obtain passed for the bene- The statute was not history of Nothing legislative el.18 litigants to fit of but to enable Congress in provision indicates that worthy counsel of a competent obtain computed
tended the
fee to be
with the caliber of counsel availa-
contest
serv
according to the market value of the
indeed,
fairly place
opposition
noth
ble to their
and to
attorney:
ices rendered
1011,
Cong.,
2000e-16(d).
S.Rep.No.
2d Sess.
21.
Id. See
94th
Id. §
2,
(1976).
17. 390
88 S.Ct.
the economical burden of Title VII tice and the lawsuit. When the contingency tion.24 applied factor is to the market rate, hourly do, majority as the would applying ap- We think the market value confusing results are and can lead to exces- proach cases in which the Government is sive awards. defendant, below, likely as will be shown clearly will un lead the award of reasona- Cálculos, method, Per majority’s if fees, congres- ble in direct contradiction to stand, allowed to will take these and other contrary, sional intent. To the the cost- Title VII attorney’s fees Ad Astra. As plus promote congres- formula will best 3,602 applied to the total of hours of work policy encouraging deserving sional liti- weighted hourly in this rate of suits, gants bring VII Title without mak- $205,916.50, results in a calculation of $57.17 attorney’s position so lucrative as to $206,000 “suggested” close to the fee by the ridicule the whole notion of a “reasonable law firm to designated the court. This is attorney’s fee.” by majority opinion as the “lodestar” or “market value”25 from which all other “ad- II. THE MAJORITY OPINION FORMU- justments” are to be made.26 It is absolute- LA-FAULTY ANALYSIS PRODUCES ly vital to see hourly what this $57.17 SKEWED RESULTS already regular includes. rates rigid interpretation In its of the statute firm, of the law lawyer, for each are neces- calling precisely as the same method of sarily designed to cover the lawyer’s indi- calculating attorney’s fees in pub- both the salary equivalent vidual or partnership pay, lic errs, sectors the majority his appropriate share of the firm’s overhead and then compounds that error by applying every respect, profit above the actual its own formula in way precludes which (which cost to the firm of his work makes ascertaining congressionally directed up the profit total firm for the partners), “reasonable fee.” Both errors recognized and -this must kept be stem from the majority’s appreci- failure to clearly in necessary mind-an amount ate the inapplicability setting, of fee as each hour which is to cover billed the nu- done private practice, market in to merous hours which for one reason or an- fixing a reasonable fee in the very different billed, other cannot be or must be billed at a situation when the Government is the de- more modest rate. The firm can never fendant. specific We now turn to examples hourly charge calculate its attorney for an extraordinary skewed results which on the theory every fallacious hour of will be the consequences inevitable of the work is going productive. to be There are majority’s faulty analysis. fundamental hours simply which cannot be regular billed
paying redundant, clients because are A. The Redundant Contingency Factor too numerous for the character of the task devoted; they which and in those We previous panel ourselves in our opin- representation instances in which the in liti- ions recognized the desirability, and indeed gation contingent (/. e., is on a basis necessity where public interest law firms defined majority opinion, compensa- concerned, were applying a contingency tion prevails), if the firm’s side hours However, factor to the basic fee awarded. may not compensable at all. (1) we did this to a basic fee calculated on cost, (2) actual the contingency factor It is basic common sense that the bill for was to part profit, the reasonable services in successful varied and judge controlled the trial on have a margin more comfortable than that appraisal factors, his of several including for a losing margin, effort. That a sort of the contingency nature prac- of the firm’s bonus for winning, acknowledges that liti- 24. Id. at 719. See also Part infra. II.C. See id. at 890-891. Maj. op. at 896. *35 prag- with for which the firm must make a accordance adjust their fees in
gators matic, charge the prudential to decision win-loss record. in their fluctuation each firm was a lower rate because the client at suits, where law purely in Even not in and could litigation not successful own from their their fees firms recover large prof- to a rationally expect recover hourly rates clients, underlying and the have had it might the case as it it from adapted to computed are they which on won. mar- In the particular circumstances. the ket, hourly rates not for fees or request fixing a of practice law the While the of litigation of conforming customary to the results rates of fees and establishment York Stock outrageous. not as volatile as the New would be is private firm Exchange, distinguished the colleagues have The fatal flaw is that our is, as our col- involved in this from the mar- taken a standard values leagues rightfully recognized, a to their ketplace, indeed have referred regular hourly The marketplace of sorts. value” fee at times as a “market “lodestar” by this firms reflect rates fixed and other is, fee, it in the applied which it and have every possible way contingencies no real sector where there is Government contingency marketplace, including fail to realize colleagues market. What our (or litigated failure in a the failure case they have the “market value” fee is e., i. bank- marketplace, of its client in the “lodestar,” starting point to taken as a all, of the of no fee at ruptcy) receipt adjusted already has a contingencies, for Title VII as could have occurred in this into the contingency substantial factor built And so in the market- litigation. their fee fee. truly is a fee on the “mar- place calculated A market is This is what a market is for. majority value” of their ket services. or services place value commodities pointed places has thus in numerous opinion As considering contingencies.27 all of the most “market value” fairest and as the above, absolutely neces- pointed we out it is starting part useful for the calculation every private firm to fix an sary for law Title plaintiff’s fees in this successful salary that takes care of the rate col- VII suit Our Government. attorney and overhead attributable leagues erroneously specified have then him, provides profit partnership, a for the adjusted upward every this fee be contingency takes care and also “contingencies,” the case to take care of many there is no those hours for which primary contingency being that of failure compensation (one of the monetary at all thus the prevail some lawsuits and contingency reasons for which is the of not at contingency of failure to receive fee fee), winning collecting the case a fee in com- and not all.28 Since “market value” automobiles, 1,001 contingencies 27. To illustrate the market- that the what we mean making contingencies, place way every marketplace its calculation of evaluates in its own price stock, of each stock on the New York Stock every day-not only but hour of for one Exchange represents absolutely most com- every comparative for stock as investment plete contingencies, calculation of known or all every other stock. imagined, presently to that stock at relevant any given price Mo- moment. The of General majority opinion, seeks to distin- 28. The at stock, example, appraisal represents tors guish “contingency” com- its notion from that past policy, earnings past of projected, dividend attempted mon in the torts field. distinc- contingencies Japa- of increased unavailing instances the tion is because in both imports, imports Japanese be- nese decreased lawyer being for under- successful rewarded restraints, voluntary Japa- cause of nese tion, decreased taking risk. legisla- imports because of United States however, distinction, There is which contingency complete failure of majority the law- overlooks: in a torts Chrysler Corporation, contingency of the yer’s contingent percentage of an a fixed plants construction of new eign for- automobile e., jurors. States, amount arrived outsiders-i. manufacturers the that of the in the United contrast, operating prevailing lawyer contingency depression un- equal of a 1930’s, majority’s contingency from a war in the Middle der the formula would benefit shutting supplies contingency payment meaningfully American con- East off fuel *36 already includes in fact it does contain such a private practice factor. And if mercial receipt does, failure and of a contingency inquire magnitude. the of it must into its he obtainable, our lower fee than otherwise Determining the existence and amount of danger duplication of colleagues create a contingency any factor in hourly rate is contingency factor to they when add this task, majority a difficult and the does not generous regular market value already suggest Although how it is to be done. hourly rate. may possible ways there be several to do majority appears recognize this, the obvious one is to break most down already market rates include a substantial putative hourly rate into its constituent factor, acknowledges contingency when parts identify component in order to hourly rate possibility underly- that “an contingency which reflects the factor. The comprehends itself the ‘lodestar fee’ contingency compo- factor would be that contingent nature of the allowance for the nent of the fee in addition to the amount availability litigation fees in Title VII of provide costs and to needed to cover against the ....”29 This is Government normally expected firm with its overall just vague possibility. more than As we words, profit rate. In other it would be the seen, adjustments contingency can long amount needed to ensure that in the expected commonplace, given be to be profit, run the firm earns its desired after general billing practices. nature of law firm taking the proportion account of of hours Consequently, contingency allowances for spent on a case that must be billed at a comprehended generally will be in the hour- lower rate if at all due to lack of success in rate, ly contingency and the al- amount litigation. very may well that a law may lowance well be substantial. profit firm’s is an desired “unreasonable” problem, majority To alleviate this marketplace problem: one. In the this is no suggests judge district has am- “[t]he is whatever the market “reasonable” will ple powers inquiry makeup into the Here, applied bear. rates arti- hourly rates to assure that the Government context, ficially poten- in a nonmarket will any duplication not suffer from such high unreasonably profits tial for desired . the majority ...”30 If is serious about difficulty of compounds isolating weeding contingency out allow- redundant component. contingency ances, judicial powers inquiry these will striking aspect any But the most tech- always play.31 have to come into Given nique employed, pursuant majority’s possibility any hourly serious rate factor, approach, identify contingency contain a fac- contingency the district tor, judge always inquire will have to whether is that the elimination of built-in con- parties. wyer Judge O’Kelley’s strained outside This la would U. S. William District C. totally have almost within his control the abili- fees decision in the Atlanta chicken antitrust ty principal to claim the into amount which the litigation hung amazing array on the line an contingency premium would be factored. lawyers’ laundry, dirty both and clean. short, torts, the difference is as follows: judge played by detailed the roles vari- jury sets the out of amount of verdict plaintiffs’ lawyers, customary hourly ous cut, lawyer which the takes his whereas in Title reportedly non-contingent- rates earned in lawyer VII fees cases the sets the cases, strategy and the used to overcome number of hours worked out of which the same litigation obstacles.... lawyer bases his cut. Customary hourly put rates forward instances, Maj. op. at 893. counsel were reduced almost all judge’s based on the of what determination Id. was “reasonable.” . .. totaling With the of the lodestar awards at inquiry expose 31. Of course will some such $1,935,730, judge reached the most sub- aspects fee-setting of law firm that some law- jective-and perhaps the most crucial-area of yers might prefer keep secret. That this analysis, multipliers. his selection of present occurs under standards can be seen Legal Washington, Aug. excerpts following Times of at 6. from the paper report aof recent news- judicial setting fees: which the factors relevant to Government be achieved more allowances could tingency (and necessarily relevant in by employing the outset simply from properly applied. Cost-plus provides private litigation) can cost-plus method. *37 colleagues have done here is a any contingency What our figure that is free of base example of miscalculation and factor; appropri- horrendous figure from that base chargeable of fees to the Govern- made to re- inflation adjustments could then be ate even taxpayer, to the without ment and nonsuccess in the case contingency flect of marketplace economics of the realizing the hand, quality of exceptional as well as at they purport rely. to on which work, duplicating any built-in con- without already included in the fee. tingency factor Injured Encouraging B. Plaintiffs or cost of services is a Starting from actual Encouraging Lawyers? approach starting than far more direct extraordinary financial Aside from hourly trying any and to weed out majority’s theory, we have results from the contingency Starting built-in allowances. disagreement with our col- a fundamental invites confu- hourly simply from the rate leagues philosophy underlying as to the duplication contingency allow- sion and prevailing liti- attorney’s award of fees to judges especially Unless district are ances. gants. diligent weeding out built-in contin- allowances, gency way policy-both there is no in which plain It is that our nation’s rate, regular hourly judicial-is promote market value legislative fee, starting “private attorneys gen- can be taken as the so-called “lodestar” efforts of rights by who our civil laws point, contingency and a factor for failure eral” vindicate plain- for Title VII applied seeking legal to that market value fee without redress then, injuries. necessary, It is totally distorting exaggerating tiffs’ plain- litigation expenses no barrier compensation awarded to successful constitute plaintiffs attorneys. discourages private tiffs’ We think that an evalua- these contingency necessary bringing grievances tion of the factor is from their before the cases, Eliminating in Title VII fairness to the courts. the barrier of attor- all bring ney’s encourages plaintiffs to assert attorneys who these suits-sometimes successfully, unsuccessfully. legal rights. their civil sometimes contingency ap- But the can factor injured plaintiffs encouraging But is a plied -salary if the actual cost of services encouraging that of law- goal distinct from starting point. and overhead-/s taken as the yers with the lure of fees bonan- contingency majority’s philosophy appears Actual has no zas.32 The cost of services in, regular legal the “sellers” of serv- factor built as does the commer- be solicitous of rate, by “buyers” the cus- hourly beyond cial which is fixed ices the needs of the market, tomary truly majority appears and which is a market these services. The value fee. is the believe that its “market value” formula Where Government services, purchaser plus actual cost is a must fees which match award petitioning lawyers’ highest opportunity on which to com- fair and reasonable basis purveyors pensate anyone, lawyer layman. lawyers Actual costs. Neither nor other base, starting products operate cost of service is a true to of and services on the colleagues appeal, have noted the statement of fame rested on his romantic not his Our previous pro precedential jurisprudence. law firm involved here that in contribution And, gave poor, the firm the fee to a bono cases has contributed Robin Hood not to their public organization lawyers. “committed to fur- interest thering public orderly the kind of interest involved suggest We a more and more consti- litigation.” particular Maj. op. Congress approach 884 n.l. tutional would be to let public organizations might decide which interest This be characterized as the Robin funds, by approach, taxpayer taking to do it rich Uncle Sam to to be subsidized Hood from deserving poor, indirectly through benefit as inflated at- for the and undirected by charity torney’s selected firm. While VII fees in Title cases. commended, thought to be we Robin Hood’s highest of achieving opportunity multiply basis costs should first reasonable time; definition, most of the the usual- rate the number of reasonably hours entirely satisfactory is less. It expended lawsuit, —reward on the the so-called encourage- seems clear that the mandated Adjustments “lodestar” fee. figure to this plaintiffs ment to is achieved granting then appropriate, the majority as- lawyers reflecting a sum their actual serts, to quality represen- account for the plus cost profit, opposed reasonable tation in particular case and the contin- highest an award which rates reflects gent logical nature of success. Another applications return that alternative flaw in the majority’s formula is that a manpower and could resources command. quality consideration of the representa- *38 simply It is not invidious to conclude that tion in particular the like that of con- acceptable the fee schedule to General Mo- tingency, supra, see Part II.A. already in- confronting possible tors when billion dol- rate, heres in the hourly reasonable one of liability necessarily applicable lar is not in the fixing two elements used in the “lode- attorney’s Title VII fees determinations. star” fee. majority reveals this logical “cost-plus” Our method brooks no disserv- gap plainly, yet it not recog- does seem to ice “private attorneys general.” to Title VII nize it. hand, overcoming On the other the legal expense private plaintiffs barrier for these The majority states that a reasonable
requires no
lawyers-only
windfall for
that
hourly
product
rate “is the
of a multiplicity
it be worth
lawyers’
their
while.33 This is of factors. Evans itself listed several of the
what our view
attorney’s
fees awards
relevant
[including,
considerations
inter
accomplishes:
plaintiffs
service for
the
the
necessary
level of skill
the
alia]
[and]
without
the
lawyers
need for
to sacrifice.34
attorney’s
reputation.”35 The attorney’s
The inevitable
op-
existence of some other
reputation corresponds to a consideration of
portunities
lawyers
gain
for
relatively
quality
the
attorney’s
of an
work in gener
higher remuneration does not mean that all
al. As the court
stated
Johnson v. Geor
legal services-including purported pro bono
Inc.,36
gia Highway Express,
(from which
compensated
work-must be
very
the
the
drawn):
factors in Evans are
“Most fee
highest figure discoverable.
scales
experience
reflect an
differential
Quality
C.
Representation
with the
experienced attorneys
more
receiv
ing larger compensation.
Under the
An
majority’s approach,
attorney spe
in calcu-
fees,
lating an award
attorney’s
cializing
court
rights
civil
may enjoy
cases
may very
be, though admittedly
colleagues say:
well
pro-
it is
34. Our
“An award of fees
clear,
majority’s
not
competent
lawyers
“market value”
vides an incentive to
to un-
operate
formula will
to shrink somewhat
rather
dertake Title VII work
if the award ade-
plaintiffs
than
quately compensates
swell
ranks of
for the amount
served. The
performed.”
“market value” hours
Maj. op.
times hour-
(empha-
of work
at 890.
ly
computation,
added).
rate
complete
method of
when
plus
combined
sis
We think
actual cost
payments only
prevailing litigants,
profit
“adequately compensates”
a reasonable
lawyers
unduly
any lawyer
work,
any
cause
pro
to stick
with a case
bono or other.
good
they
that looks
once
have
Congress
committed ini-
We further
assert
this is all
tial
by calling
resources.
“Market value” would incline
could have intended
for “a reasona-
lawyers
pumping
many
attorney’s
cases,
to continue
hours as
ble
fee” in Title VII
and that
possible
winner,” possibly sacrificing
into “a
Supreme
this meets
Court’s views ex-
hopeful plaintiffs.
pressed
needs of
Piggie
Enterprises,
other
in Newman v.
Park
“cost-plus”
entails,
approach
Inc.,
perhaps,
400, 401-02,
964, 965-66,
a bit
390 U.S.
88 S.Ct.
discipline
more
(1968).
internal
Obviously
within the law firm.
the statutory goal then any other method I, opinion, In this Part we examined at yet proposed, apt and no case is better to length unique some affecting factors illustrate this than the case at bar. Title VII
Returning specific against Government, facts of this analysis which case, putting the in perspective, matter is an development elaboration and of young labors of the attorneys (plus thoughts two panel opinion. set forth in our first time) partners’ some hours of resulted in a At that readily apparent time it was promotion higher to a level something GS and back was needed as a substitute for pay $4,169.80 plaintiff basis; for the Copeland. hence, the commercial fee the court’s addition, following negotiation original opinion of a suggested that actual cost settlement, remaining plus members of the class profit a reasonable and controllable particularly comparison 43. A remand is called for in this works in with the old standards. case, so we can see how the new formula employees. pri- rate assist the individual of the market value instead substituted firm, words, starting point performing for the district in other as the initial vate law court’s calculation. that Government attor- the same function in cases neys frequently perform
B. Rationale private employers. pro publi- This is a bono be, service, surprising fact it is claimed to with the out the rather co or so pointed We assert the value objective bringing equita- that when law firms about fair and a rather work to their clients-itself employees by their ble treatment its concept, as witness the claim here nebulous Government itself. $31,345 $206,000 plus expenses versus legal service is pro Where such a bono promotions awarded-the pay plus in back involved, a better and more what could be “never reveals the value of the attor- firm fair measure to the law firm than its actual firm, e., neys’ to the i. the value of work “cost, plus a reasonable and controllable brought to the firm gross income profit”? This is the same cost- margin of business, attorneys ordinary in the course of plus applied formula which has been for paid out compared as sums govern- years innumerable innumerable personal as income and to those recognized It is ment service contracts. defray overhead costs attributable equitable; fair and the usual criticism is in the maintenance greater it results in a award to seemed to us firm.”44 It reasonable than if he had contractor been performing ostensibly that where a firm is competitive forced to made a bid and be service, pro publico bono its reimburse- competitive bidding with it. stuck Such ment for that service should bear a direct course, system, inapplicable relationship to the actual costs incurred suggests that services and no one should and, fact, the firm that this was the best adopted. Contrary surpris- to the rather possible point, at least in the ini- reference ing unnecessary language of the law tial calculation. petition-“Lawyers firm’s and law firms are the trial We therefore stated: “Thus utilities, public cost-plus informa- give court should to abandon- consideration determining tion is irrelevant to reason- traditionally] hourly-fee claimed able value of their services market- starting point for its calculations in favor of place” cost-plus 46-this formula is a well principle of reimbursement to a firm for recognized equitable many one for vari- costs, plus its a reasonable and controllable type ous Government service contracts. margin profit. a principle Such can be *41 applied through separation of the several usually The market rate is stated as so components hidden of the usual hour, many per dollars but we all known fee.”45 private fixing practice that in fees in this is beginning. Unfortunately, in fix- this, In cases such as in which the ing it is often a court too both the alleged offending Government is the em- end, beginning many and in and the cases- ployer, the Government does not undertake example-the the instant is one for result prosecution suit for the benefit of In fix- indefensible on a commercial basis. private individuals, aggrieved as it can private practice fees in rate private employer where there is a involved. starting point, for is all the hours worked a employees individual Government must plus a of the benefit consideration private help, turn to firms for and thus client, ability pay, previ- the client’s private acting “pri- firms are in effect as and, fact, client attorneys general,” they vate in ous business with that or business future, only “attorneys general” hoped are the who can in the rela- gained to be (D.C.Cir.1978). Appellee Rehearing 44. 594 F.2d 46. See for and Petition of Banc, Suggestion Rehearing for En at 3. added). (emphasis Id billing lawyer lationship with the law- to the usual tionship compensation for side, legal government services. clients on the other yers and the lawyers which the alternative work on plus What our “cost a reasonable and have been whom the fee is billed could profit” guideline controllable does is to re- are taken engaged-all these factors into out-of-pocket turn actual cost to the many Not of them are read- consideration. attorneys’ legal firm for its services and all Title VII suits ily applicable to overhead, plus a reasonable and controlled value hourly If the market Government. profit. private How much more should a to be modified the usual rate is not legal law firm receive for its services? private in a com- brought play factors into plus How much more than cost a reasonable mercial then it is an unsafe and un- can it be profit entitled to? How much point. pro starting realistic Since bono plus more than cost profit reasonable involved, government legal work is actual justified would this court be awarding in overhead) (salary plus provide should cost against the Government and its taxpayers? basis, starting to which more accurate Application C. profit. a reasonable
should be added petitioning conjures up law firm cost-plus To the extent that the formula application enormous difficulties of by the opin- the other factors mentioned in the prying court and of into confidential firm than might ion result a lower commercial this, matters. We absolutely see none of if fee, government legal services-and here the proposed plus profit cost reasonable for- acting private law firm is as a private at- applied mula is on sensible basis. If torney general pro publico bono suit- the trial court doing, understands what it is always paid been less than those in the there should be no substantial additional example, sector. For Justice De- evidentiary burden the trial court. The partment lawyers begin- do not start at the figures basic are simple simple to arrive ning salary large paid at law firms in at, as discussed below. Washington, very top D.C. The Justice De- partment lawyers approach do not even general components The three we identi- earnings partners large such firms overhead, fied in opinion salary, our were legal that involved here. Government work profit. expected has never been pay the same as Salary-The starting salary young top private legal work. What the law lawyers with the large firms in Wash- firms, large firm here and other law York, ington, many large New other firms, public interest law are doing public cities is almost a matter of record. government legal work-on the other side The “going hiring strictly rate” for com- govern- issue these cases from the petitive and well known to both the law employer ment itself.47 young lawyers coming firms and the in. Furthermore, even the raises for the first colleagues using Our are insistent on years few are standardized. concept “market value” as the correct basic in fixing fair and reasonable fees. And, course, while opinion our talked Very colleagues well. recognize Our should salary actually paid terms of the *42 the market we are dealing in which in a case, lawyers individual involved Title VII case the Government: we entirely satisfactory would be if the law dealing by in a “market” created merely firm furnished information on the paying Government48 we are lawyers to average salary paid young lawyers in that defend the Government and to sue the firm with the years’ expe- same number of Government, dealing we are in the “mar- (In case, rience. the instant both associates services; government legal ket” for “a rea- assigned year were this matter in their first firm.) sonable fee” must bear some re- of employment at the 47. See Part supra. See Part I.E. I.F. supra. higher is out line “salary,” our overhead factor of regard partners’
With deliberately put this on the basis of know about it. opinion and should highest from the associ- extrapolation an The claim is made since the cost- recognize that the income salary. We ate’s plus formula allows all overhead costs to be may vary partners in the same firm of losing party, this shifted to the cuts down firms, widely between widely, even more keep overhead costs low. the incentive to may very well be partner’s and a share engaged virtually the firm is exclu- Unless Typically, in thought of as confidential. work, in Title VII this would not be sively cases, the fee claimed Title VII the share of average so at The overhead cost would all. small, partners’ usually very labors is as for the work done all reflect all of case. the instant type all cases. in the firm on this at 2. Overhead-The firm knows opinion sugges- 3. Profit-Our made no annually, computing it is not its least or court as to what is a tion to the trial well correctly. income tax If the firm is profit. This is a calculation in- reasonable managed, it should know its overhead fac- factors, including volving many the attor- firm quarterly monthly. Every tor or even firm, neys’ profit return usual surely average makes a calculation as to the benefits, gain social the direct to the liti- fee-pro- overhead factor for its individual gants, particu- demonstrated in the skill ducing lawyers. degree contingency lar and the preposterous arguments, One of the but involved. made, strongly is that most firms now make costs, overhead, profit accounting no Inequities D. Feared from Substantive basis, attorney-by-attorney on an and that the New Method a mountain of details will be called for. Special Problems Small Firms misinterpretation totally This rests on a Practitioners Solo opinion. average our It is the overhead per attorney opinion cost to which the re- argument a. The is made that small law fers.49 practices prove expenses will not be able high prac- as as those of better established partners develop be that in fact firms, larger tices or and thus will not be more overhead cost for the firm than do equivalent secure fees for the same able to offices, (bigger associates more luxurious work. furnishings, etc.), taken but this could be average figure care overhead may may (small This true not be firms figure part- associates and a different frequently higher per lawyer over- ners. head), question but the of course arises: Is any there alternate work in which such any given city, probably there is no engaged in firms would have been which great per lawyer difference in the overhead they get greater would fees? practice; of similar sized firms in similar The answer firms, hence, great perhaps composed there are no secrets to be these get just great younger lawyers, good revealed. If there are differences in will overhead, management they possibly firm the firm claim- as alternative work could indicated, opinion panel percentage gross 49. As our second aver- terms of a income and satisfactory ages perfectly way apply are a of mini- it to standard rates. Since it is not un- mizing private likely operate firms’ finances intrusion into that most firms on an eliminating percentage (including excessive on minuti- overhead associate sala- are, course, ries) percent, ae. of different There a number of somewhere between 35 and 55 figuring average percentage reasonably methods for costs. One could is a accurate ex- averages suggest- computed the basis pression utilize of the amount of each dollar of fee fig- panel opinion-individual ed the second particular attributable to a firm’s “costs.” ures calculated for and overhead of obviously the salaries completely While this is accurate associates, first-year associates, second-year carry higher higher profit since rates *43 Alternatively, simple etc. take the one could margin, average. it is nevertheless an accurate expressed annual firm overhead costs of a higher awarded should indeed be than it stage at this do, probably and better would. otherwise their careers. that if answer is A more fundamental Contingent Fees obtain a full large and firms
both small
argued
It is also
that most Title VII cases
plus
rea-
expenses,
return of their actual
contingent
are on a
fee basis and thus a
inequity
no
there can be
profit,
sonable
produce
successful Title VII case should
small firms.
large
the treatment
substantial
reward in order to allow their
inap-
alleged that the formula is
b.
It is
agree.
We
practice to continue.
Contin-
because there
plicable
practitioner,
to a solo
which should be
gency is a factor
evaluated
his
“salary”
to his
from
guideposts
are no
as
.
judge
pondering
is
time the trial
salary
partner’s
or his
income.
associate’s
profit” part
“reasonable
of the fee to be
practitioner
profit”
is a case
A “reasonable
in a contin-
Perhaps
solo
allowed.
higher
be
than
gency
be made without
fee case should
where
which a fairer
can
award
relatively
the fee is
certain and the
formula, and there is
using
cost-plus
the outcome of the
question
decided
case
nothing
opinion which mandates
in our
pays
is who
it.50
However,
every case.
cost-plus formula in
going salary
to take the
possible
it would be
4. Class Action Practitioners
lawyers of the
several firms for
rate of
made that somehow a
extrapolate
argument
if
The
is
years
experience,
same
fully
contingency
remunerative
recov-
be,
practitioner
award the solo
need
had,
ery from the
will not be
Government
his overhead and a
plus
fee based on that
and therefore class action claims cannot be
profit.
reasonable
obscure,
this is
sustained. The basis of
readily apparent
it seems
the formula
for the Public In-
Similar Problems
profit is
plus
of actual cost
a reasonable
Rights
terest and Civil
Bar
remunerative,”
every way “fully
especially
special-
A similar claim is made for these
that other
when it is remembered
factors
ists, alleging
public
interest and
account,
are to be taken into
as set forth
operate under far lower
rights
civil
firms
above.
overhead,
salary,
profit margins
than
argument
private practice.
others in
is
Representing Poor
5. Counsel
Clients
plus
reasonable
made
somehow cost
Generally
profit penalizes these firms.
type
It
is claimed that counsel
the same as to a small firm
answer is
practice usually
very
salary
have a
low
They
guaran-
will
practitioner.
or solo
be
true,
margin.
If this is
profit
overhead and
profit above their actual
teed a reasonable
plus
profit
guaran-
the cost
reasonable
will
public
are
aware that
inter-
costs. We
equal
will
at least
tee them a return that
rights
usually
est and civil
firms
receive
practice,
to that received in their usual
However, the trial court
more than this.
probably better.
could-and,
view,
-evaluate
in our
should
Long Hours
6. Counsel Who Work
special
public
skills which a
interest or
bring
rights
among
civil
firm
to bear
habitually
argued
those who
quality
the other
factors which the court
disadvantaged by
long
work
hours will be
applies
plus
cost
reasonable
actual
average hourly
on the
formula based
profit figures.
special-
If the
return,
average hourly
their
rate of
since
cases,
may have
ists in Title VII
and thus
If that
necessarily
return will
be low.
high
been
to do the work at a
standard
true,
able
in these Title VII
then the return
expended, then
way
with a minimum of hours
differ from the alterna-
eases will in no
compensation
they might
doing.
which
“profit”
their
in the total
tive work
applied
contingency
contingency “lodestar” method
50. We have discussed
the redundant
method,
supra.
cost-plus
distinguishing
majority’s
it from
in Part II.A.
*44
theory implicit
in several of
E. Fear of Deterring Representation
these
in
hypothetical
is that
problems raised above
Title VII Cases
compensation
somehow
for the Title VII
argues
princi-
law firm
that for three
lawyers
work should be a bonanza to
pal
cost-plus
reasons the
formula will deter
cases,
particular
they
these
in order that
(1)
lawyers
taking
from
on Title VII cases:
may
practice
continue their
other worth-
remuneration;
(2)
rates of
difficulty
lower
relatively
type
while but
unremunerative
data;
compiling
(3)
relevant
disclosure
cases. We cannot see that
this is a valid
requirements.52
argument
fixing
at all for
a fee
fact,
virtually
Government-in
admits
prospective
As to
lower rates of remuner-
lawyers
relying
have been
on
some
ation,
arises,
question immediately
what
gain
Title VII work to
relative bonanzas.
kind
lawyers
of remuneration have these
receiving
litigation?
been
in Title VII
Requirement
of Public Disclosure of
they
receiving
customary
Have
been
their
Financial Information
overhead,
salary,
plus
all
an unreasonable
bugaboo
good
This is the
firms will
profit?
latter,
If
high
it is
time the
simply
unwilling
comprehen-
to disclose
taxpayers
courts and the
knew about
it.
sive financial information.51
If
litigators
these Title VII
have not been
pointed
above,
required
As
out
infor-
receiving
nearly
amounting
mation is
to all their cus-
“comprehensive”
so
as
parties
make it out to be. Unless a
tomary
plus
costs
profit,
un reasonable
drastically
firm is
out
salary
of line in its
plus
their fears of the cost
profit
reasonable
costs,
scale or its overhead
no detailed data
groundless.
formula are
need be submitted
court. An affida-
apprehension
One source of these firms’
that,
partner
vit of a
based on its account-
may be that they are not sure how a “rea-
records,
average
per
overhead
law-
profit”
sonable
will be calculated. Bear in
yer
many
was so
dollars an hour and the
that,
above,
mind
explained
among
other
average
to,
salary paid
example,
for
law-
bearing
profit
factors
a trial court
yers with
years
experience,
two
was a
should
any contingent
take into account:
amount,
sufficient,
certain
should be
unless
fee,
nature of the
and the
appeared drastically
extent
to which
error when com-
pared to
similarly
firms
situated.
particular
depends
upon
firm
contin-
public
51. We are also aware that a number of
tiff’s counsel have the resources to handle ma-
interest
jor
firms have filed briefs amici curiae in
discrimination cases but have substantial
expressing
this case
their concern about the
practices
may
forego
in other areas
decide to
cost-plus
poten-
use of the
calculation and its
seeking statutory fee awards or even cease
upon
practices.
tial effect
their
We assume
representing
rights plaintiffs altogether.”
civil
organizations
that most of these
are tax-ex-
Appellee Rehearing
Sugges-
Petition of
empt non-profit
pursuant
firms
to section
Banc,
Rehearing
(13
tion for
En
at 11
Dec.
501(c)(3) of the Internal Revenue Code. As
1978).
such, although they
prohibited
using
from
However, they go
say:
on to
probability
the likelihood or
award of
pro
Plaintiff’s counsel
take
bono cases
cases,
selecting
they may
fees in
may
whether or not counsel fees
be awarded.
“accept attorneys’
public
fees in
interest cases
majority
cases,
In the
of such
no fee is or can
paid by opposing parties
if such fees are
”
fees,
sought.
sought
be
pro
The firm
has
some
75-13,
are awarded
..
court.
. Rev.Proc.
provided
bono cases where statutes have
organizations
1975-
is tradi- customary
tional approaches, as demon-
strated what has occurred in this adequate. not be More refined anal-
ysis and consideration of alternatives are
required.
TRAILS,
representing
INC.,
When
Petitioner,
SAFEWAY
client, attorneys must
billing
exercise
they
judgment;
must consider
labor
NATIONAL LABOR RELATIONS
expended
view
result
BOARD, Respondent,
judgment
achieved. This economic
is ab-
sent when
treasury
the federal
footing
is
Transportation Union,
United
Intervenor.
the bill. Other solutions must
ex-
No. 78-1155.
plored.
panel
This is what
wisely
has
United States
Appeals,
Court of
suggested.55
District of Columbia Circuit.
inWe
dissent are convinced that
tra-
Argued
March
1979.
customary
ditional
commercial fee approach
billing
attorneys’
Government for
Decided Sept.
1979.
fees in Title
case
adequate
VII
is not
Certiorari Denied Feb.
likely
grossly
lead to
excessive fees. A
See
cost profit reasonable formula in this Our analysis,
case. original our opinion “Now, Peter, bit doubtful and hesitant. St. if 54. See Memorandum of the United States in place get Response Request there’s one I don’t want to under into to Court’s Views Peti- pretenses, really Banc, Rehearing false it’s I (24 Apr. 1979) Heaven. died at tion for En at 1 age frowned, perplexed, (footnote 78.” omitted). St. Peter looked “Ah, and consulted the scroll I in his hand. see your age. where we our made mistake as to Id. at 12. just your up We added time sheets!” put It is time the courts the calculation of respect- fees on a basis which can be ed.