KENNY A., by his next friend Linda WINN, Kara B., by her next friend Linda Pace, et al. v. Sonny PERDUE, in his official capacity as Governor of the State of Georgia, Department of Human Resources of the State of Georgia, et al.
No. 06-15514
United States Court of Appeals, Eleventh Circuit
Nov. 5, 2008
ON PETITION FOR REHEARING EN BANC
545 F.3d 1319
Before EDMONDSON, Chief Judge, and TJOFLAT, ANDERSON, BIRCH, DUBINA, BLACK, CARNES, BARKETT, HULL, MARCUS, WILSON and PRYOR, Circuit Judges.
Mark H. Cohen, Troutman Sanders, Atlanta, GA, for Defendants-Appellants. Corey Fleming Hirokawa, Jeffrey O. Bramlett, Bondurant, Mixson & Elmore, Atlanta, GA, for Plaintiffs-Appellees.
IV. CONCLUSION
In sum, we hold that the Madrid action was both “in any way related” to the Tucker action, and that it was “pending” and “existed” “against” Capstone before the Policy‘s Prior Litigation Date. Thus, the Policy‘s “prior litigation” exclusion applies to Capstone‘s claim for loss related to Tucker. Accordingly, we reverse the district court‘s order and remand the case with instructions that the district court enter summary judgment for Defendant-Appellant Twin City on that basis.
REVERSED and REMANDED.
a Georgia statute. Thus, Capstone‘s invocation of Snellville does not change our analy-
ON PETITION FOR REHEARING EN BANC
ORDER:
The Court having been polled at the request of one of the members of the Court and a majority of the Circuit Judges who are in regular active service not having voted in favor of it (
WILSON, concurring in the denial of rehearing en banc:
I concur in the Court‘s denial of rehearing en banc only for the purpose of responding to the dissents that follow. I believe that existing precedent regarding the discretion afforded to district judges to calculate attorney‘s fee awards based on the longstanding lodestar analysis is clear, and not as confusing as the dissents attempt to make it out to be. Several decades of established Supreme Court precedent make it clear that district judges are vested with discretion to enhance a fee in accordance with a federal fee-shifting statute, in the “rare” and “exceptional” case, when there is specific evidence in the record to support an exceptional result and superior performance. See Pennsylvania v. Delaware Valley Citizens’ Council for Clean Air (”Delaware Valley I“), 478 U.S. 546, 565, 106 S.Ct. 3088, 3098, 92 L.Ed.2d 439 (1986); Blum v. Stenson, 465 U.S. 886, 104 S.Ct. 1541, 79 L.Ed.2d 891 (1984).
In Blum, the Supreme Court held that the “quality of representation” and the “results obtained” from the litigation could not serve as an independent basis for increasing the basic fee award only because the attorneys in Blum offered no evidence of an exceptional result or superior performance. Blum, 465 U.S. at 899, 104 S.Ct. at 1549. That is not the case here. In Blum, the Court indicated that the outcome would have been different had the plaintiff‘s attorneys “offer[ed] specific evidence” to demonstrate that an enhancement was necessary to reflect counsel‘s performance. Id. I find no language in Blum that can be interpreted to suggest that upward adjustments for excellent results or superior performance are categorically excluded. The Court stated that an upward adjustment may be justified in the “rare case where the fee applicant offers specific evidence to show that the quality of service rendered was superior to that one reasonably should expect in light of the hourly rates charged” and resulted in “exceptional” success. Id.
Delaware Valley I presented the Supreme Court with a clear opportunity to overrule Blum, but it did not expressly do so. Rather, the Court repeatedly cited Blum with approval. See Delaware Valley I, 478 U.S. at 564, 106 S.Ct. at 3098 (“We further refined our views [regarding the proper manner in which to determine a ‘reasonable’ attorney‘s fee] in Blum f[inding] that [the lodestar] is presumed to be the reasonable fee . . . .“); id. at 568, 106 S.Ct. at 3100 (quoting Blum, 465 U.S. at 897, 104 S.Ct. at 1549) (leaving questions left open in Blum to be decided later). Additionally, the Supreme Court in Delaware Valley I echoed Blum‘s non-categorical language and conducted a case-specific analysis of the enhancement at issue. See id. at 566-68, 106 S.Ct. at 3099-3100.
Moreover, the Supreme Court affirmed in Delaware Valley I that “upward adjustments of the lodestar figure are still permissible in certain ‘rare’ and ‘exceptional’ cases, supported by both ‘specific evidence’ on the record and detailed findings by the lower courts.” Id. at 565, 106 S.Ct. at 3098 (quoting Blum, 465 U.S. at 898-901, 104 S.Ct. at 1548-50). See The Supreme Court, 1986 Term: Leading Cases, 101 HARV. L. REV. 270, 293 (1987) (concluding that the Delaware Valley I Court “rejected the use of an enhancement based on superior attorney performance absent specific evidence that the lodestar did not provide a reasonable award that reflected the quality of representation“). The dissents mischaracterize Delaware Valley I by ignoring this language, which precedes the Court‘s holding that
Importantly, there is no circuit split on this issue. The Second, Fourth, Fifth, Sixth, Eighth, Ninth, Tenth, and Eleventh Circuits—all of the circuits that have considered this issue—agree that a district court may provide an enhancement for exceptional performance. See Kenny A. v. Perdue, 532 F.3d 1209, 1242 (11th Cir. 2008) (affirming a lodestar enhancement); Geier v. Sundquist, 372 F.3d 784, 794-95 (6th Cir. 2004) (concluding that Delaware Valley I permits enhancements based on quality of representation and results obtained in rare and exceptional cases); Van Gerwen v. Guarantee Mut. Life Co., 214 F.3d 1041, 1046 (9th Cir. 2000) (stating that, as in Blum and Delaware Valley I, upward adjustment for quality of representation “is justified only in the rare case where there is specific evidence that the quality of service was superior in light of the hourly rates charged and that the success was exceptional“); Quaratino v. Tiffany & Co., 166 F.3d 422, 425 (2d Cir. 1999) (“The lodestar may be adjusted based on several factors, including in particular the results obtained . . . .“) (internal quotation marks and citation omitted); Forshee v. Waterloo Indus., Inc., 178 F.3d 527, 532 (8th Cir. 1999) (stating that, to justify enhancement for outstanding service and results, the applicant “must establish that the quality of service rendered and the results obtained were superior to what one reasonably should expect in light of the hourly rates charged and the number of hours expended“) (internal quotation marks and citation omitted); Hyatt v. Apfel, 195 F.3d 188, 192 (4th Cir. 1999) (affirming enhancement “on account of the exceptional results obtained . . . .“); Roe v. Cheyenne Mountain Conference Resort, Inc., 124 F.3d 1221, 1233 n. 8 (10th Cir. 1997) (“The lodestar figure may be adjusted to suit the particular circumstances of the case, especially where the degree of success achieved is exceptional.“); and, Shipes v. Trinity Indus., 987 F.2d 311, 320 (5th Cir. 1993) (noting that upward adjustments based on quality of representation and results obtained are proper where supported by specific evidence on record and detailed findings by lower courts).
The discretion to enhance an attorney‘s fee is a tool uniquely within the province of the district judge. The district judge has an unparalleled opportunity to observe the attorney‘s performance in a given case. Only the district judge can evaluate the attorney‘s performance from the day he or she files the complaint to the day the judge enters the order. Before arriving at its decision in this case, the district judge set forth detailed findings to explain why the lodestar figure did not fully reflect the quality of representation and the results achieved.
Judge Tjoflat‘s dissent mischaracterizes the district court‘s observations and findings in its published order as “testimony.” These findings and observations are simply explanations for the enhancement, provided because Blum and Delaware Valley II require that an enhancement be justified. This is not a due process violation. The district judge explained that he was motivated to enhance by his “own substan-
We need not disturb our precedents in Norman v. Housing Auth. of Montgomery, NAACP v. Evergreen, and Kenny A. because they are consistent with existing Supreme Court precedent. Kenny A., 532 F.3d at 1242; Norman v. Housing Auth. of Montgomery, 836 F.2d 1292, 1302 (11th Cir. 1988); NAACP v. Evergreen, 812 F.2d 1332, 1336-37 (11th Cir. 1987) (per curiam). Our decisions are also consistent with every other Circuit that has considered whether, and to what extent, exceptional performance and results can be used to enhance an attorney‘s fee under the lodestar calculation. The Supreme Court has instructed that a district judge should only do so in an exceptional case when there is specific evidence to support it. Kenny A. is that case.
TJOFLAT, Circuit Judge, dissenting from the denial of rehearing en banc:
In this case, the district judge, in undertaking the task of awarding attorney‘s fees to the prevailing plaintiffs under a federal fee-shifting statute,
I dissent from the court‘s failure to take this case en banc. In light of the numerous fee-shifting statutes that Judge Carnes has cited in the appendix to his dissenting opinion, the panel‘s reading of NAACP and Norman, which I believe goes beyond the cases’ holdings, will control the litigation of attorney‘s fees issues in this circuit. But there are reasons other than the panel‘s reading of NAACP and Norman that require the full court‘s attention en banc—reasons independent of those Judge Carnes advances.
If my reading of NAACP and Norman, as set out in part I, is correct, the district court‘s decision should be vacated and the case remanded to the district court. I would vacate the court‘s decision on two independent grounds: (1) the decision is unreviewable; and (2) the manner in which the court used its own testimony to enhance plaintiffs’ attorney‘s fees request denied the defendants due process of law.
If my reading of NAACP and Norman is wrong, and their holdings required the panel to affirm, en banc review is still necessary to determine whether—in a case seeking the sort of injunctive relief plaintiffs sought and obtained in this case—quality of performance and the result obtained are permissible grounds for enhancing a lodestar fee that already incorporates an hourly rate at the top of the relevant market for the type of services performed. I contend in part III that an enhancement on these grounds is not available in cases like the one before us.
I.
In NAACP, we vacated and remanded the district court‘s decision refusing to grant an attorney‘s fee enhancement. We did so due to ambiguities in the district court‘s stated bases for denying the enhancement and the court‘s failure to address plaintiffs’ “exceptional success” justification for a fee enhancement. NAACP, 812 F.2d at 1336-37. In Norman, we reversed and remanded the district court‘s refusal to enhance the attorney‘s fee award because the court used the wrong standard in assessing the significance of the results the plaintiffs had obtained. Norman, 836 F.2d at 1306.
While we did assume in those cases that, at least theoretically, “superior results coupled with superior performance can be the basis for an enhancement of the lodestar amount,” Kenny A. IV, 532 F.3d at 1238 (emphasis added), in neither case did we hold that fee enhancements granted on those grounds must be affirmed. We certainly did not hold that a district court would not be abusing its discretion if it enhanced an attorney‘s fee award on the basis of exceptional performance or result, particularly where, as here, the court re-
Judge Hill, who joined the remainder of Judge Carnes‘s opinion, voted to affirm the fee enhancement solely “because we are bound” by NAACP and Norman. Id. at 1251 (Hill, J., concurring). None of the three panel opinions referred to the district judge‘s statements as testimony given ex parte and without notice or questioned whether those statements were unreviewable. Yet the panel necessarily accepted the statements as probative evidence; otherwise, the panel could not have reached the result it did.
Because, however, the panel relied on the supposedly preclusive effect of NAACP and Norman, the panel gave those decisions greater precedential value than they deserve, by their own terms, in the future review of fee enhancements. Should the panel‘s decision stand, there would be almost no room for a panel of this court to find that a district court abused its discretion in granting a fee enhancement on the basis of the lawyer‘s purportedly superior performance or the result attained. For this reason alone, we should hear this case en banc to clarify and limit the reach of NAACP and Norman so that future courts will not mistakenly find their precedential effect so constraining.
II.
If my reading of NAACP and Norman is correct, the district court‘s decision should be vacated and the case remanded to the district court. As I explain in subparts A and B, the decision is unreviewable and is the product of the denial of due process of law.
A.
The district court‘s decision to enhance the lodestar in this case through the use of a multiplier of 1.75 ultimately was driven by the court‘s personal experience and subjective relative assessment of the lawyers’ performance.4 Specifically,
based on its personal observation of plaintiffs’ counsel‘s performance throughout this litigation, the Court [found] that the superb quality of their representation far exceeded what could reasonably be expected for the standard hourly rates used to calculate the lodestar. Quite simply, plaintiffs’ counsel brought a higher degree of skill, commitment, dedication, and professionalism to this litigation than the Court has seen displayed by the attorneys in any other case during its 27 years on the bench.5
Kenny A. III, 454 F.Supp.2d at 1288-89 (emphasis added). Along similar lines, the
The district judge arrived at the fee enhancement by comparing counsel‘s performance and the result obtained in this case with the attorneys’ performance and the result plaintiffs obtained in other cases. The court did not identify the other cases, the comparators, but I assume that they were cases over which the district judge presided and that they were class actions in which the plaintiffs sought equitable relief as sweeping, or nearly so, as what plaintiffs sought in this case. Indulging this assumption, the judge‘s statements regarding the quality of counsel‘s representation and the result plaintiffs achieved invite a multitude of questions, none of which the judge answered, including:
- What quality of representation would “consumers of legal services in the legal marketplace in Atlanta” have expected to receive for the rates used in the lodestar the district judge fixed in this case?
- What cases was the district judge using as comparators? Were they cases in which the attorneys claimed a far lower fee? (If so, counsel in this case should have been expected to bring “a higher degree of skill” to their task in order to earn the higher requested hourly rate.)
- What definition of “success” did the court use?
- What level of success did plaintiffs’ counsel achieve in the comparators? Assuming that the level of success they achieved was lower than what counsel achieved in this case, why was it so?
The district judge provided no clue as to the answers to these questions. Accordingly, the critical portions of the record for review—the specific evidentiary facts on which the decision turned—do not exist. It is well-established that “no enhancement is permissible unless there is specific evidence in the record to show that the quality of representation was superior to that which one would reasonably expect in light of the rates claimed.” Norman, 836 F.2d at 1302 (citing Blum, 465 U.S. at 899, 104 S.Ct. at 1549) (emphasis added). A district judge‘s mental impressions that are based on unknown facts cannot be reviewed.6
The district judge provided the critical evidence that plaintiffs needed to obtain an enhancement of the lodestar that they proposed and that the court accepted as full compensation for services rendered. The evidence was testimonial and was given ex parte and without notice to the defendants.7 In arriving at his fee-award decision in this manner, the judge denied defendants fundamental due process of law. “[I]t is not proper to admit ex parte evidence, given by witnesses not under oath and not subject to cross-examination by the opposing party.” Hornsby v. Allen, 326 F.2d 605, 608 (5th Cir. 1964).8 The district judge was required to afford defendants the right of cross-examination and, depending on what cross-examination might disclose, an opportunity to put on rebutting evidence.9 It is obvious to me
The first choice would have required his recusal from the case. When a judge becomes a material witness in a case over which he is presiding, he must recuse and let another judge take over. The judicial disqualification statute provides, in pertinent part, as follows:
(a) Any justice, judge, or magistrate judge of the United States shall disqualify himself in any proceeding in which his impartiality might reasonably be questioned.
(b) He shall also disqualify himself in the following circumstances:
(1) Where he has a personal bias or prejudice concerning a party, or personal knowledge of disputed evidentiary facts concerning the proceeding;
III.
In this part, I assume that my reading of NAACP and Norman is wrong and that their holdings required the panel to affirm the enhancement of the lodestar by a multiple of 1.75. En banc review would still be necessary to explore the proposition that quality of performance and result may be employed in a class action brought under
A.
Aside from the procedural deficiencies associated with the lodestar enhancement in this case, it appears to me that an attorney‘s fee enhancement based on “exceptional” or “superior” results can never be appropriate in a class action, like this one, in which plaintiffs sought sweeping equitable relief.10 Assuming that a court sitting in equity properly discharges its function in entering a just and legally ap-
In any case in equity, such as the
Under either approach—a bench trial or a consent decree—the court‘s obligation is the same. First, the final judgment must be fair and just under the circumstances. Second, because the decree will be enforced through the court‘s civil contempt power, the decree‘s injunctive provisions must be enforceable, meaning capable of feasible enforcement. To the extent they are not, the provisions should not be entered, as the issuance of an injunctive order that cannot be enforced breeds disrespect for the rule of law. Thus, in considering whether to enter a consent decree, a court must ask itself the same questions it would ask in assessing the adequacy and propriety of its own order after finding for the plaintiffs at the end of a bench trial: Are the injunctive provisions to be entered not only fair and just under the circumstances, but are they also capable of enforcement through the court‘s civil contempt power? Do they reach only as far as is necessary to right the wrong, to give the plaintiffs the relief to which they are legally entitled but not more? Are they tailored as narrowly as is necessary to effect the appropriate relief?
This evaluative rubric will produce one of three qualitative assessments: (1) the order will do justice and give the plaintiffs what the law allows; (2) the order will give the plaintiffs more relief than the law allows, which is plainly improper;11 or (3) the order will provide less relief than the law allows, which would be unconscionable and unjust. Every entered injunctive order or decree should fall into the first category; a court should never enter an order or approve a consent decree falling into the second or third category. Accordingly, in any given equitable case, there can be but one legally proper result.
In this case, we must assume that the consent decree approved by the district court was prepared by competent counsel on both sides and was crafted to be just and legally appropriate under the circumstances, affording the plaintiff class no more and no less than that to which it was legally entitled. Were this not the case, the district court would not—and should not—have approved it. It is against this necessary background assumption that we must review whether the result the consent decree provided could ever be deemed “exceptional” or “superior” relative to the result the district court would have fashioned had it tried the case or the results reached in other comparable cases. As a matter of law and logic, it cannot.
However, assuming, as we must, that a comparator case involved an order or consent decree whose injunctive provisions both (1) were fair and just under the circumstances, affording the plaintiffs all the relief to which they were legally entitled but no more, and (2) were feasibly enforceable, it is hard to see how the result in this case could be qualitatively “superior” or “exceptional.” Indeed, were a district court to have found the result in the case before it to be “exceptional” or “superior” relative to comparator cases, it necessarily would have to conclude that the injunctions in the other cases were unconscionable, unjust, or unenforceable and, ipso facto, should never have been entered.
In this case, in which the district judge presumably relied on comparator cases from his own body of judicial experience, his finding that the result in this case was “exceptional” and “superior” enough to justify a fee enhancement implicitly denigrates his own prior judgments by suggesting that they failed to satisfy the standard for proper equitable relief and that he never should have entered them. I am unwilling to assume that the district judge erred in deciding those prior cases—nor could I reach such a conclusion in any event because, as the district judge has not disclosed which other cases he was considering, I have no way to know which decisions to evaluate. Therefore, I have to assume that the injunctive relief awarded in the comparator cases was every bit as just, fair, and enforceable as the relief in this case and, accordingly, no less “exceptional.”
The upshot is that, in the context of equitable relief, no properly-crafted injunction can be more “exceptional” than or “superior” to any other. As such, it can never be appropriate to enhance the attorney‘s fees in a case seeking injunctive relief on the basis of “exceptional” or “superior” results.
B.
In light of what the Supreme Court has said regarding the proper composition and function of the lodestar,13 I am convinced that the district court was precluded from enhancing the admittedly adequate lodestar on the basis of counsel‘s performance. “[T]he lodestar figure includes most, if not all, of the relevant factors constituting a ‘reasonable’ attorney‘s fee, and it is unnecessary to enhance the fee for superior performance in order to serve the statutory purpose of enabling plaintiffs to secure legal assistance.” Pennsylvania v. Del. Valley Citizen‘s Council for Clean Air, 478 U.S. 546, 566, 106 S.Ct. 3088, 3098, 92 L.Ed.2d 439 (1986). The lodestar is normally already assumed to account for the difficulty and cost of the case and the performance rendered by the attorney. The proper way to account for attorney performance is in setting the hourly rate, not in enhancing the lodestar.
A fee enhancement might conceivably be appropriate where an attorney quotes his client an hourly rate at the outset of the case, and later submits that rate to the court as his reasonable rate, yet that hourly rate ultimately proves to be insufficient in light of what the case in fact required the attorney to do.14 Perhaps in the beginning the attorney did not accurately predict or appreciate how much time or effort the case would require, the level of resources he would have to devote, or the complexity of the issues that would arise. In short, an attorney who finds himself in over his head, stuck with an inadequate hourly rate, may be able to warrant relief in the form of a fee enhancement in order to obtain full and fair compensation for the work actually performed.
The situation is very different, however, when, as should more typically be the case, the attorney does not request an hourly rate until the end of the litigation and the submission of the fee application. At this stage, the attorney already knows how much time, skill, effort, and expense he has devoted to the case. With this knowledge, he is able to determine the combination of hours and hourly rate that will compensate him adequately for his services, in light of the results obtained and the prevailing rates in the relevant market for comparable legal services. Attorneys know how to value their own services, and this fully compensatory rate is the one that the attorney should request. Having already included every factor properly bearing on compensation—including the degree of the attorney‘s performance and the results obtained in the litigation—there is no need or justification for an enhancement on top of this. Anything over and above this fully and fairly compensatory fee, to be candid, could only be the product of the attorney‘s greed or the judge‘s favoritism. Neither ground is, or should be, permitted under the fee shifting statutes or sanctioned by this court.
IV.
I conclude where I began. The court ought to rehear this case en banc for reasons aplenty.
CARNES, Circuit Judge, dissenting from the denial of rehearing en banc, in which TJOFLAT and DUBINA, Circuit Judges, join:
Although I have been on the short end of en banc votes before, this is the first time in sixteen years on the bench that I have written, or even joined, a dissent from the denial of rehearing en banc. I take this unusual step to explain why I believe that in this case “a United States court of appeals has decided an important question of federal law that has not been, but should be, settled by [the Supreme] Court.” Sup.Ct. R. 10(c).
The important, unresolved question this case presents is one that affects the proper application of at least one hundred federal fee-shifting statutes that allow the prevailing party to recover a reasonable attorney‘s fee from the losing party. In arriving at an attorney‘s fee award, a district court calculates a lodestar amount by multiplying the reasonable number of hours worked, which reflects the difficulty of the case, by an hourly rate that fully reflects the attorney‘s skill and experience. See Penn. v. Del. Valley Citizens’ Council for Clean Air, 478 U.S. 546, 563, 106 S.Ct. 3088, 3097, 92 L.Ed.2d 439 (1986); Hensley v. Eckerhart, 461 U.S. 424, 433, 103 S.Ct. 1933, 1939, 76 L.Ed.2d 40 (1983).
My court of appeals has answered that question “yes” in this case by affirming the district court‘s judgment, which included a $4.5 million enhancement based on a number of factors, the most important of which were what the district court found to be superior performance and exceptional results. Kenny A. ex rel Winn v. Perdue, 532 F.3d 1209, 1218 (11th Cir. 2008) (majority opinion);1 id. at 1225, 1242 (Carnes, J., concurring); id. at 1247, 1249 (Wilson, J., concurring); id. at 1251 (Hill, J., concurring); see also Kenny A. ex rel. Winn v. Perdue, 454 F.Supp.2d 1260, 1288-90 (N.D.Ga. 2006). The performance and results component was so important to the district court‘s enhancement decision that we declined to vacate and remand the enhancement on other grounds, concluding that it would be futile to do so given the primacy of that component. Id. at 1242 (Carnes, J., concurring) (recognizing that the district court improperly took contingency and other factors into account but explaining that it would be futile to remand on those grounds because “[t]he district court was so obviously enamored with the performance of plaintiffs’ counsel and with the result that they achieved, and so determined to reward them for it, that we have no doubt the court would simply reinstate the enhancement“); see also id. at 1242, 1248 (Wilson, J., concurring) (agreeing that the district court should not have considered the contingency factor in making its enhancement decision but voting to affirm the full amount of the enhancement anyway).
Two of the three judges on the panel voted to affirm the multi-million dollar enhancement part of the fee award in this case because they were bound to follow established circuit law that a district court may take a reasonable attorney‘s fee award and enhance it for what the court views as extraordinary performance and results. Id. at 1236-38 (Carnes, J., concurring); id. at 1251 (Hill, J., concurring); see generally Norman v. Hous. Auth. of Montgomery, 836 F.2d 1292, 1302 (11th Cir. 1988); NAACP v. City of Evergreen, 812 F.2d 1332, 1336-37 (11th Cir. 1987). The third judge on the panel voted to affirm the enhancement both because binding circuit law permits it and because he reads Blum v. Stenson, 465 U.S. 886, 104 S.Ct. 1541, 79 L.Ed.2d 891 (1984), as “establish[ing] that enhancements for quality of representation and exceptional results, while not warranted in most cases, are permissible where supported by specific evidence.” Kenny A., 532 F.3d at 1243, 1246 (Wilson, J., concurring).
The Supreme Court speculated on this issue in the Blum case, but the facts did not present it. There was no specific evidence in that case to support the district court‘s conclusory findings that, among other things, the quality of legal services was superior to what one should reasonably expect and that the results obtained were exceptional. Blum, 465 U.S. at 898-99, 104 S.Ct. at 1548-49. The Court reversed the enhancement in the Blum case. Id. at 902, 104 S.Ct. at 1550. Therefore, what the Blum decision
The Blum case does not establish as law the proposition that with specific evidence and findings an enhancement for superior representation and exceptional results is permissible. It could not. A decision in a case where particular facts are not present cannot establish the law governing cases where those facts are present. Any statements, and certainly any implications from statements, in the Blum opinion about what might have been the result if the facts had been different are nothing more than dicta. See Cohens v. Virginia, 19 U.S. (6 Wheat.) 264, 399-400, 5 L.Ed. 257 (1821) (“It is a maxim not to be disregarded, that general expressions, in every opinion, are to be taken in connection with the case in which those expressions are used. If they go beyond the case, they may be respected, but ought not to control the judgment in a subsequent suit when the very point is presented for decision.“) (Marshall, C.J.); United States v. Santos, 553 U.S. 507, 128 S.Ct. 2020, 2031, 170 L.Ed.2d 912 (2008) (plurality opinion) (speculations that address a case not before the Court “are the purest of dicta“); Parents Involved in Cmty. Schs. v. Seattle Sch. Dist. No. 1, 551 U.S. 701, 127 S.Ct. 2738, 2762, 168 L.Ed.2d 508 (2007) (plurality opinion); Cent. Va. Cmty. Coll. v. Katz, 546 U.S. 356, 363, 126 S.Ct. 990, 996, 163 L.Ed.2d 945 (2006).2
The Supreme Court had another go at the issue two years later in the Delaware Valley I case. The court of appeals had affirmed an enhancement based in part on
Those categorical statements are clear, and if the Delaware Valley I Court‘s discussion had ended there everyone would agree that this type of enhancement had been categorically ruled out. The problem is that the discussion did not end with those statements. Instead, there was a “furthermore.” After explaining why the quality of the performance or the results obtained cannot serve as bases for enhancing the fee award, the Court stated that “[f]urthermore” there was neither specific evidence nor specific findings in that case about why the results were so outstanding or why the quality of representation was not fully reflected in the lodestar. Id. at 567-68, 106 S.Ct. at 3099. And “[i]n the absence of such evidence and such findings,” the Court could “find no reason to increase the fee award” based on the quality of representation. Id. at 568, 106 S.Ct. at 3099-3100.
There are two ways to interpret the Delaware Valley I decision and its “furthermore” discussion. One way is to read the decision as containing two alternative holdings: an enhancement for superior representation and exceptional results is never permitted; and, even if it were, there was insufficient evidence or findings of anything special in that case. See Kenny A. IV, 532 F.3d at 1239-41 (Carnes, J., concurring). The other way is to read Delaware Valley I as containing not two alternative holdings but only one, which is that such enhancements are not allowed absent specific evidence and findings to support the conclusion that the quality of representation and results obtained were truly special. See Kenny A. IV, 532 F.3d at 1243-45 (Wilson, J., concurring); Geier v. Sundquist, 372 F.3d 784, 794-95 (6th Cir. 2004). Under that view, everything before the “furthermore” in the Delaware Valley I opinion is not an alternative holding but only dicta.
If my alternative holdings interpretation of Delaware Valley I is correct, then the law of this circuit and of the Sixth Circuit is flatly contrary to Supreme Court precedent, which needs to be clarified so that it will no longer be misinterpreted as holding exactly the opposite of what it does. If, instead, the narrow interpretation of the Delaware Valley I decision is correct, then the Supreme Court has yet to hold—not imply, intimate, or suggest in dicta but actually hold—whether the federal fee-shifting statutes allow an enhancement when there is specific evidence and findings of superior performance and unexpected results.
The issue is clearly and squarely presented in this case. Two of the panel members in this case sharply disagreed and wrote about the meaning and effect of the Blum and Delaware Valley I decisions, both of which reversed instead of affirmed enhancements for superior performance and results. Those two panel members also disagreed about the effect on this issue of the reasoning in City of Burlington v. Dague, 505 U.S. 557, 112 S.Ct. 2638, 120 L.Ed.2d 449 (1992), which is the Court‘s last decision on the subject of lodestar enhancements. Compare Kenny A. IV, 532 F.3d at 1221-33, 1239-41 (Carnes, J., concurring) with id. at 1242-49 (Wilson, J., concurring). The third panel member kept his views about that matter to himself. See id. at 1251 (Hill, J., concurring). The bottom line for certiorari review purposes, however, is that the law of the Eleventh Circuit permits this kind of enhancement, and that law was applied to permit a $4.5 million enhancement of the lodestar amount in this case. See id. at 1236-39, 1242 (Carnes, J., concurring); id. at 1242, 1251 (Wilson, J., concurring); id. at 1251 (Hill, J., concurring).
The decision whether to affirm or vacate the $4.5 million enhancement part of the attorney‘s fee award turns on whether an enhancement for superior performance and exceptional results is permissible. If boosting the fee award on that basis is not proper, the judgment of the district court will have to be vacated and the case remanded. On remand the enhancement will have to be set aside entirely or at least substantially reduced because without that basis the $4.5 million increase above the lodestar amount of reasonable fees cannot stand.
This case presents the superior performance and exceptional results enhancement issue as well as any ever will because the evidence and findings in this case are as specific as any are likely to be. It is true that the evidence that the attorneys put into the record in this case was in the form of affidavits from friendly lawyers with a vested interest in boosting the award, and for that and other reasons I did not find it particularly convincing. See id. at 1231-33 (Carnes, J., concurring). But the district court and at least one panel member did. See id. at 1247-49 (Wilson, J., concurring); Kenny A. III, 454 F.Supp.2d at 1290. More importantly for present purposes, the evidence in this case goes beyond that in the Blum and Delaware Valley I cases, and given the nature of the question it is hard to imagine any more specific supporting evidence than is in the record here.
And the supporting findings by the district court were probably as specific as any could be, to say nothing of the enthusiasm with which they were uttered. See Kenny A. III, 454 F.Supp.2d at 1288-90. The district court unequivocally proclaimed that the attorneys being awarded fees “brought a higher degree of skill, commitment, dedication, and professionalism to this litigation than the Court has seen displayed by the attorneys in any other case during its 27 years on the bench.” Id. at 1289. To convey its feelings about the result obtained, the court reached back beyond its 27 years on the bench, stating that “[a]fter 58 years as a practicing attorney and federal judge, the Court is unaware of any other case in which a plaintiff class has achieved such a favorable result on such a comprehensive scale.” Id. at 1290.
In fact, the district court speculated, the results the attorneys were able to achieve through settlement probably exceeded what their clients were entitled to receive under the law. Id. at 1289-90 (“[E]ven if plaintiffs had prevailed in a trial of this case, it is doubtful that they would have obtained relief as ‘intricately detailed and comprehensive’ as that contained in the Consent Decree.“); see also Kenny A. IV, 532 F.3d at 1229-30 (Carnes, J., concurring)
It may be that the evidence and findings in this case are insufficient to support a superior performance and exceptional results enhancement. If so, it likely will be because no evidence or findings can ever justify an enhancement on performance and results grounds because the lodestar already takes into account all of the factors that go into how well an attorney performs and the result obtained. The decisions in Dague and Delaware Valley I imply as much. See Dague, 505 U.S. at 562-63, 112 S.Ct. at 2641-42; Delaware Valley I, 478 U.S. at 565-66, 106 S.Ct. at 3098-99. If that is the law, the Supreme Court needs to tell those of us on the lower courts because that point has not gotten across. See, e.g., Kenny A. IV, 532 F.3d at 1243-45 (Wilson, J., concurring); Geier, 372 F.3d at 794-95; see also Norman, 836 F.2d at 1302; NAACP, 812 F.2d at 1336-37. See generally Kenny A. IV, 532 F.3d at 1239 n. 29 (Carnes, J., concurring).
The importance of the lodestar question presented by this case extends beyond the particular statute involved in this case. It arises not only under
At a minimum, there are “over 100 separate [federal] statutes providing for the award of attorney‘s fees.” Delaware Valley I, 478 U.S. at 562, 106 S.Ct. at 3096. The actual number may be higher. See Marjorie A. Silver, Evening the Odds: The Case for Attorneys’ Fee Awards for Administrative Resolution of Title VI and Title VII Disputes, 67 N.C. L.REV. 379, 386 n.47 (1989) (estimating that “Congress has enacted anywhere from 100 to 200 fee-shifting statutes” (citations omitted)); John F. Vargo, The American Rule on Attorney Fee Allocation: The Injured Person‘s Access to Justice, 42 AM. U.L.REV. 1567, 1588 (1993) (noting that “[t]here are over 200 federal statutes . . . that provide for shifting of attorney‘s fees“). A partial list of federal fee-shifting statutes is attached as an appendix to this opinion. The precise number of federal “reasonable attorney‘s fee” statutes is not the point. The point is that this issue arises under not just one federal statute but under at least a hundred of them.
An unresolved issue affecting so many federal statutes is important. The record in this case and the facts and findings drawn from it present this important, unresolved issue as well as any case will and better than almost any other case can. It presents an opportunity for the Supreme Court to reach the issue it could not reach in Blum and Delaware Valley I: Under the federal fee-shifting statutes can a reasonable attorney‘s fee be enhanced based on extraordinary effort or results where some evidence and findings support the enhancement, or are all of the factors that lead to the quality of the performance and the results obtained already covered in the lodestar calculation, as the opinions in Delaware Valley I and Dague imply?
APPENDIX
Partial List of Federal Statutes Providing for the Prevailing Party To Recover a Reasonable Attorney‘s Fee
Notes
Blum, 465 U.S. at 901, 104 S.Ct. at 1550 (footnote omitted). The speculative “may be” language is “the purest of dicta,” Santos, 128 S.Ct. at 2031 (plurality opinion), because the enhancement in Blum was reversed instead of affirmed. The quotation from Hensley is itself the purest of dicta because that case involved the reduction of an attorney‘s fee award for partial success, not the enhancement of one for more success than was expected. Hensley, 461 U.S. at 426, 103 S.Ct. at 1935-36.[W]e reiterate what was said in Hensley: “where a plaintiff has obtained excellent results, his attorney should recover a fully compensatory fee. Normally this will encompass all hours reasonably expended on the litigation, and indeed in some cases of exceptional success an enhancement award may be justified.” Hensley, 461 U.S., at [435], 103 S.Ct., at 1940. We therefore reject petitioner‘s argument that an upward adjustment to an attorney‘s fee is never appropriate under
§ 1988 .
For what it is worth, I agree with the literal statement in the dicta of the last sentence of the quotation from Blum, which rejects the argument that an upward adjustment of a fee award is never appropriate. While I believe that enhancements are never appropriate for superior performance and exceptional results, see Kenny A., 532 F.3d at 1220-42 (Carnes, J., concurring), they may well be appropriate in other situations, especially those involving unpopular clients or causes where the attorney suffers from the representation in ways not compensated by the lodestar. Id. at 1233-34 (giving three examples); see also Guam Soc‘y of Obstetricians & Gynecologists v. Ada, 100 F.3d 691, 698-99 (9th Cir.1996) (concluding that enhancement was appropriate where case was extremely controversial and attorney received death threats during the course of the litigation). No one contends that this is a case where the clients were detested, the litigation was unpopular, or the attorneys’ standing in their profession or community suffered in the least. In fact, just the opposite is true. Kenny A., 532 F.3d at 1234-35 (Carnes, J., concurring); cf. Applegate v. United States, 52 Fed.Cl. 751, 773 (Fed.Cl. 2002) (reversing judgment awarding enhancement where “the facts here demonstrate that [plaintiffs’ counsel] was not prosecuting an unattractive case, but rather pursuing a cause celeb—the type of case that a firm with local roots likely would embrace and seek to publicize to its clients and prospective clients as an indication of its community involvement“).
In approving in full the hourly rates that the plaintiffs requested, the district court expressly relied on “the stellar performance of plaintiffs’ counsel throughout this long and difficult case,” Kenny A. III, 454 F.Supp.2d at 1286. That admission perfectly frames the question of whether the Supreme Court meant what it said in Delaware Valley I about “the novelty and complexity of the issues, the special skill and experience of counsel, the quality of representation, and the results obtained from the litigation [being] presumably fully reflected in the lodestar amount, and thus [those factors] cannot serve as independent bases for increasing the basic fee award.” Delaware Valley I, 478 U.S. at 565, 106 S.Ct. at 3098 (quotation marks omitted, brackets omitted and added). The district court plainly counted “the stellar performance of plaintiffs’ counsel” twice—once in setting the high hourly rates and again in enhancing the lodestar after using those hourly rates to calculate it. Kenny A. III, 454 F.Supp.2d at 1286, 1288-89.
First, “[a] judicially noticed fact must be one not subject to reasonable dispute in that it is either (1) generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned.”
An attorney‘s fee hearing under a fee shifting statute is essentially a nonjury trial limited to the issue of fees. Therefore,Further Action After a Nonjury Trial. After a nonjury trial, the court may, on motion for a new trial, open the judgment if one has been entered, take additional testimony, amend findings of fact and conclusions of law or make new ones, and direct the entry of a new judgment.