Lead Opinion
Opinion for the Court filed by Circuit Judge SENTELLE.
Dissеnting Opinion filed by Circuit Judge STARR, in which Circuit Judges SILBERMAN and BUCKLEY concur.
The panel opinion in this case, Save Our Cumberland Mountains, Inc. v. Hodel,
Should Laffey v. Northwest Airlines, Inc. ... be overruled to the extent that it holds that in awarding attorneys’ fees to a private law firm, that customarily charges below the prevailing community rate in order to serve a particular type of client, courts should calculate the “reasonable hourly rate” according to the hourly rates charged in similar cases by that firm, as opposed to rates that reflect the prevailing community rate for similar legal services?
Id. Having reviewed the question en banc, we now answer that question in the affirmative and overrule Laffey.
I. Background
The factual background of the substantive litigation underlying this attorneys’ fee dispute is set forth in both the panel opinion and the District Court opinion, Save Our Cumberland Mountains, Inc. v. Hodel,
The District Court, in attempting to determine the reasonable hourly rate, first
The panel opinion noted that under Laf-fey, this case is factually distinct from Blum v. Stenson. In Blum, the attorneys seeking the fee awards were salaried employees of the Legal Aid Society of New York, a private, non-profit law office. The District Court had applied prevailing market rates for attorneys of like competence and experience in the same area doing similar work during the relevant period. Stenson v. Blum,
The panel opinion of this Court reviewed Blum and Laffey and determined this case to be controlled by Laffey. Plaintiffs’ attorneys in Laffey, like SOCM’s attorney in the case at bar, charged some clients at hourly rates less than the prevailing average, from motives of subsidizing what they perceived to be “good" clients or clients with good causes. Laffey,
In the present case, the panel applied Laffey and determined that Yablonski’s average rate, for the 20 to 50 percent of his clients whom he charged on an hourly basis, was $100 per hour and that Galloway charged a “reduced rate” for “national environmental and conservation groups” of from $75 to $100 per hour. Applying the Laffey rule to those facts, the panel determined that $100 was the proper hourly rate for the determination of the lodestar as to Yablonski and Galloway.
It is in this posture that we now consider plaintiffs’ contention that Laffey must be overruled.
II. Analysis
As both Blum and Laffey teach, the determination of an award of reasonable attorney fees is at bottom a question of statutory interpretation. In Blum, the Supreme Court construed the Civil Rights Attorney’s Fee Award Act of 1976, 42 U.S.C. § 1988 (1976 & Supp. V), which expressly authorized the award of a reasonable attorney’s fee to prevailing civil rights litigants other than the United States. In determining the intent of Congress as to the meaning of the phrase “reasonable attorneys fees” (emphasis supplied), the Court looked in large part to the Senate Report which approved the method employed in four cases, Johnson v. Georgia Highway Express, 488 F.2d 714 (5th Cir.1974); Stanford Daily v. Zurcher,
The Blum Court then went on to determine from this legislative history that “Congress did not intend the calculation of fee awards to vary depending on whether plaintiff was represented by private counsel or by a nonprofit legal services organization.” Id. at 894,
Later that same year, we faced in Laffey the question of applying that statutory analysis to a fact situation, like the one at bar, in which the plaintiff’s attorney did not fall neatly into either of the categories “private counsel” or “nonprofit legal services organization.” The Laffey counsel, like SOCM’s counsel, was literally engaged in private for-profit practice, but adjusted fee schedules downward from pro bono or quasi public interest motives to reflect the reduced ability of the client to pay or what the attorney saw as the importance and justice of the client’s cause. The Laffey Court noted that the Supreme Court has interpreted “a reasonable attorney’s fee” to be one that is “adequate” to attract competent legal advice, but does not produce “windfalls” to attorneys. Laffey,
It was against this background of Blum and Laffey that the panel opinion in the present case attempted to determine a reasonable hourly rate for Yablonski and Galloway.
Since Galloway and Yablonski did in fact have hourly billing histories, the panel started with those rates, applied the Laffey brackets and concluded that the lower than prevailing market rate of $100 per hour was the appropriate rate and that the District Court had erred in using higher rates based upon its determination of the prevailing market.
The members of the panel spoke in three separate opinions expressing varying degrees of dissatisfaction with the Laffey rule. Judge Bork’s opinion announced the decision of the Court but did so noting that “[wjhether or not Laffey’s position on this point is correct — and the dissent presents a serious argument that it may not be — this
Judge Ruth B. Ginsburg separately concurred but joined the dissent’s conclusion that Laffey “is of questionable consistency with Blum v. Stenson ... and bears reexamination.” Id. at 54 (citation omitted) (Ginsburg, Ruth B., J., concurring). Chief Judge Wald dissented in part, finding Galloway’s rate policy to be distinguishable from that of the law firm in Laffey, but conceded the controlling precedent of Laf-fey as to Yablonski’s fees. She then criticized Laffey as being inconsistent with Blum, producing anomalous results, and being a far distance from the congressional intent. As she put it “[i]f this is what Laffey has wrought, it is time that we or Congress took a harder look.” Save Our Cumberland Mountains,
Therefore, each member of the panel in differing terms and to differing degrees, questioned the correctness of the Laffey holding, but concluded that “Laffey ... is the law of the Circuit ... and binds us unless and until overturned by the court en banc or by Higher Authority.” Id. at 54 (Ginsburg, Ruth B., J., concurring). This the Court en banc now does.
A. The Anomalous Result
As Chief Judge Wald and Judge Ruth B. Ginsburg note in their separate opinions, the Laffey application of the Blum rule produces an anomaly. The highly paid commercial, for-profit law firm can receive awаrds equal to its usual handsome rates.
To describe the result of the Laffey holding, and to observe it in the context of the present facts, is to reveal its anomalous nature. If the public spirited attorney is in a position, either by devoting the vast bulk of his time to other profit making representation or because of independent means, to represent the public interest group for free, then he can be awarded at high market rates for his pro bono efforts. That is, if he becomes a traditional for-profit practitioner using the market or higher fees charged to his commercial clients as subsidies for his pro bono clients during the course of their litigation, then his market rates will entitle him to the higher fee awards. On the other hand, if he always represents all clients free (whether or not they be deserving and impecunious), then his non-economic choices will result in the economic boon that Blum and Laffey provide for the attorney without a billing history. However, if either his own economic circumstances or the available but limited means of the client make it advisable to charge the client at rates providing some compensation but below the market rate, then those rates create a cap for his services. Thus, the practitioner outside the large or established firm may either eschew pro bono representation, directing those potential clients of the Laffey or SO CM mold to the established firm or legal aid societies if either of those entities is available and willing to undertake the representation, or quote fictitious but market-based rates, which neither he nor the client have any intention of actually seeing collected in toto unless court-awarded fees are ultimately available. Neither of these alternatives seems consistent with the policies behind fee shifting statutes or accepted prin
The effect of the anomaly upon the client has an even more negative impact. As this case illustrates, reduced profit public interest lawyers often acquire particular experience and expertise in specific public interest areas. The District Court’s finding that “Mr. Galloway has had a coal-related practice for over ten years, and is considered on [sic] of the leading experts on the Surface Mining Act” stands unchallenged. Save Our Cumberland Mountains,
Of course, if Congress, in enacting the statutes which we now construe, expressed an intent to compel these results, we would have no choice but to accept them. It is not the function of this Court to rewrite statutes. Thus, if the Laffey construction of the fee shifting statutes is correct, the panel opinion would stand. However, as we demonstrate below, this is not the case.
B. The Congressional Intent
The result sought by plaintiffs, that is a fee award based on prevailing market rates rather than the actual rates of Yablonski and Galloway, is not only not inconsistent with the express intent of Congress, but rather accomplishes Congress’ express goals. As noted above, the very Senate Report relied on by the Supreme Court in Blum v. Stenson reveals the goal to be “fees which are adequate to attract competent counsel, but which do not produce windfalls to attorneys.” S.Rep. No. 1011, 94th Cong., 2d Sess. 6 (1976) (emphasis supplied). By striking down the anomalous result of the Laffey rule, we in fact achieve the situation which one commentator has described as follows:
[P]ublic interest lawyers will continue to provide the specialization, freedom from conflicts with private clients, readiness to take on unpopular cases, and willingness to carry the cost of protracted cases that is indispensable to full enforcement.
Berger, S., Court Awarded Attorneys’ Fees: What Is “Reasonable”?, 126 U.Pa.L. Rev. 281, 323 (1977).
Congress after all did not simply express its intent that the fees would attract counsel, but rather that they would be “adequate to attract competent coun-sel_” S.Rep. No. 1011, 94th Cong., 2d Sess. 6 (1976) (emphasis supplied).
Nor should the congressional desire to avoid windfalls to attorneys deter this result. Cf. S.Rep. No. 1011, 94th Cong., 2d Sess. 6 (1976). It is not inconsistent with the avoidance of windfalls to pay attorneys аt rates commensurate with prevailing community standards of attorneys of like expertise doing the same sort of work in the same area. In fact, the Senate Report supports this conclusion. That Report, as noted above, was relied on by the Supreme Court in Blum as authoritative on the question of congressional intent in defining “reasonable counsel fees.”
The Johnson case itself is now often referred to as if it were the genesis of the lodestar method. That opinion did not in fact set forth the three steps described above of first determining the reasonable number of hours, then determining the reasonable hourly rate or lodestar, and then using multipliers as merited. What it actually did was set forth twelve “guidelines,” now commonly referred to as the “Johnson factors,” which the Fifth Circuit deemed appropriate for use in fee award calculations “consistent with those recommended by the American Bar Association’s Code of Professional Responsibility, Ethical Consideration 2-18, Disciplinary Rule 2-106.”
(1) The time and labor required.
(2) The novelty and difficulty of the question.
(3) The skill requisite to perform the legal service properly.
(4) The preclusion of other employment by the attorney due to acceptance of the case.
(5) The customary fee.
(6) Whether the fee is fixed or contingent.
(7) Time limitations imposed by the client or the circumstances.
(8) The amount involved and the result attained.
(9) The experience, reputation, and ability of the attorney.
(10) The “undesirability” of the case.
(11) The nature and length of the professional relationship with the client.
(12) Awards in similar cases.
Johnson,
The lineage of the lodestar as such is more properly traceable to Lindy Bros. Builders, Inc. v. American Radiator and Standard Sanitary Corp.,
In Stanford Daily, the District Court expressly sought to
avoid the Scylla of simply accepting the attorneys’ account of the value of the legal services which they have provided[, and] the Charybdis of decreasing reasonable fees because the attorneys conducted the litigation more as an act pro bono publico than as an effort of securing a large monetary return.
Swann v. Charlotte Mecklenburg Bd. of Educ.,
Thus, despite the criticism by the majority in Laffey, we find Swann to be instructive on the point we consider today. We
More significantly for our purposes, as noted above, the Swann Court expressly considered “[f]ees customarily charged for similar services.” Id. He also considered as one factor the “[f]ees paid to opposing counsel.” Id. at 485. The opposing counsel were conventional for-profit law firms.
The third case eongressionally approved as properly applying the appropriate standards, Davis v. County of Los Angeles, supra, is not on point. That case involved a true public interest legal organization with no ascertainable billing history. That decision therefore presages the exact question answered in Blum v. Stenson. Nonetheless, Davis is in no sense inconsistent with our conclusion that Congress did not intend the private but public-spirited rate-cutting attorney to be penalized for his public spiritedness by being paid on a lower scale than either his higher priced fellow barrister from a more established firm or his salaried neighbor at a legal services clinic.
In short, we conclude that our prior decision in Laffey v. Northwest Airlines, Inc., and the panel decision in this case, which it compelled, are both inconsistent with the intent of Congress in enacting fee award statutes and with the Supreme Court’s decision in Blum v. Stenson which construed those statutes. We therefore expressly overrule Laffey to the extent that it imposes the above discussed different method of determining reasonable attorney fees on attorneys situatеd as Yablonski and Galloway are here. Henceforth, the prevailing market rate method heretofore used in awarding fees to traditional for-profit firms and public interest legal services organizations shall apply as well to those attorneys who practice privately and for profit but at reduced rates reflecting non-economic goals.
C. Second Litigation
The Secretary argues here, as Northwest Airlines did in Laffey, that the approach used by the District Court in the
Indeed, defendants’ argument on this subject defeats itself. The very language from Blum argued by the defense here, as quoted by us above, comes from the Blum Court’s analysis of the proper methodology for applying fee award statutes to public service legal organizations. The very paragrаph cited by the Secretary goes on to say “[nevertheless ... the critical inquiry in determining reasonableness is now generally recognized as the appropriate hourly rate. And the rates charged in private representations may afford relevant comparisons.” Blum,
D. The Remaining Remand
Despite the fact that we vacate so much of the panel opinion as is inconsistent with this opinion (that is so much of that opinion as relied on Laffey), and adopt the reasoning of the District Court on the basic method of determining a reasonable hourly rate, a limited remand is necessary. In arriving at the “prevailing community rates” applicable to Yablonski’s and Galloway’s fee award determination, the District Court relied, at least in part, on the schedule of prevailing community rates compiled by the District Court in Laffey. Save Our Cumberland Mountains,
We do not intend, by this remand, to diminish the value of the fee schedule compiled by the District Court in Laffey. Indeed, we commend its use for the year to which it applies. Perhaps the most desirable result of the present litigation would be the compiling of a similar schedule of prevailing community rates for other relevant years.
In making this remand we encourage the parties to act reasonably in pursuit of any possible settlement. Already this case has occupied the time of the Courts and the attorneys since 1981. Since 1985, the litigation has concerned attorneys’ fees. Consistent with the admonitions of the Supreme Court in Hensley v. Eckerhart, we would urge the parties not to unduly prolong what is already “a second major litigation.”
VACATED AND REMANDED.
Notes
. As the panel noted, the attorneys’ fee provision applicable to this case does not "require that the award be ‘reasonable’; instead, it simply empowers the court to award fees to 'any party, whenever the court determines such award is appropriate.’ 30 U.S.C. § 1270(d) (1982). Nonetheless, the Supreme Court has found that an identically worded fee statute in the Clean Air Act, 42 U.S.C. § 7604(d) (1982), should be interpreted in accord with the more abundant jurisprudеnce addressing the attorney’s fee provision in the Civil Rights Act, 42 U.S.C. § 1988 (1982), and other statutes that award a ‘reasonable’ attorney’s fee_’’ Save Our Cumberland Mountains,
. Provided, of course, these do not exceed the Laffey brackets.
. See American Bar Ass'n, Model Rules of Professional Conduct (1984), Rules 3.3, 4.1 (Candor and Truthfulness), and Rule 6.1 (Pro Bono Pub-lico Service).
. Again we note that the Supreme Court was construing a different fee awards statute, but again the analysis applies. See supra note 1. While the dissent accuses us of tilting at windmills, the dissent's consistent theme of tilting at windfalls challenges opponents that are not even there. We do not propose, as the dissent suggests, that all attorneys be remunerated at the same rate, regardless of their competence, experience, and marketability. We only aim to provide that their experience, competence, and marketability will be reflected in the rate at which they are in fact remunerated.
. Now embodied in the ABA Model Code, Rule 1.5. See supra note 3.
. The Johnson Court discussed each factor in a separate paragraph. See Johnson,
. The modifications in the District Court’s opinion ordered by the panel in the present litigation, other than those brought before this court en banc, involved adjustments to the District Court’s calculation based on later developments drawn from the cited Supreme Court cases in the jurisprudence of fee awards applying the Johnson factors to the lodestar rather than as multipliers.
. The dissent's enshrinement of enablement as "the Congressionally ordained purpose," p. 1529, infra, unduly emphasizes a singlе aspect. We do not deny the primacy of that goal but as we have demonstrated both Congress and the Supreme Court have made the congressional aims of “adequacy” and "competency” part and parcel of the statutory fee award computation. The dissent’s reliance on the $75 per hour (with adjustments) cap in the Equal Access to Justice Act, 28 U.S.C. § 2412(d) (1982), is particularly ill-advised. That statute can as easily be read as demonstrating that Congress knew how to cap a rate when it wished to do so. Since it did not apply this cap to the statute before us, we can then conclude the cap of the EAJA does not apply nor is it instructive. We note that no such capping intent appears in the Civil Rights Act, 42 U.S.C. § 1988 (1982), which is in fact instructive to our analysis. See supra note 1.
. The cited Swann decision does not expressly relate this fact. However, reference to the earlier reported decisions, in the underlying substantive controversy, Swann v. Charlotte Mecklenberg Bd. of Educ.,
Dissenting Opinion
dissenting, in which Circuit Judges SILBERMAN and BUCKLEY concur:
In the thirteen years since the Supreme Court’s decision in Alyeska Pipeline Service Co. v. Wilderness Society,
This, I hasten to add, is Congress’ will, and as my colleagues rightly point out, our task in this enterprise is ultimately one of divining Congress’ intent. “As both Blum and Laffey teach, the determination of an award of reasonable attorney fees is at bottom a question of statutory interpretation.” Maj.Op. at 1518.
It is in this respect that Laffey deserves vindication, not burial. In my view, Laffey faithfully interprets Congress’ will, especially as elucidated by recent decisions of the Supreme Court. In addition to being faithful to Congressional intent, Laffey has had the happy consequence of ushering in a rational, efficient, and sensible regime in the administration of justice in this jurisdiction. Laffey works. We should keep it.
I
From its genesis, controversy has swirled around Laffey. Shortly after Laf-fey’s birth, an effort was mounted to snuff out the decision, but the cоurt thought the better of it at the time. We have now had the not inconsiderable benefit of several years of life with Laffey. Those have been happy years for the administration of justice in this circuit.
The criticisms, which have continued unabated, fall into two broad categories. The first is Laffey’s asserted infidelity to Congressional intent; the second is the anomalous results said to flow from its operation. These are weighty charges indeed. The first is of course the pivotal indictment, for however asymmetrical Laffey’s regime is said to be (save for the extreme circumstance, of which Laffey for all its manifold sins has never been accused, of triggering serious equal-protection questions), a conclusion that Congress ordained a different approach would perforce bring the debate to a speedy halt. And it is thus to the question of Congress’ intent that I initially turn.
II
A
The commonly-aired critique — that Laf-fey fails to comport with legislative intent —is, upon analysis, built on sand. It rests in the main, as evidenced by my colleagues’ analysis, on the fact that the pertinent Congressional Reports refer approvingly to three lower court cases, two of which the court’s opinion today discusses at length. This is, with all respect, a singularly precarious basis for divining Congress’ meaning. Quite apart from frequently voiced concerns as to the relevancy аnd helpfulness of legislative history, Burlington Northern Railroad Co. v. Oklahoma Tax Commission,
[Johnson’s] mode of analysis ... was not without its shortcomings. Its major fault was that it gave very little actual guidance to District Courts. Setting attorney’s fees by reference to a series of sometimes subjective factors placed unlimited discretion in trial judges and produced disparate results.
Id.
High Court departure from Johnson ian complexities was nothing new. Indeed, Delaware Valley I was only reporting on Johnson’s demise. Although the legislative history’s approbation of Johnson was unqualified, the dеcision’s shortcomings had not been lost on the lower federal judiciary. To the contrary, it was in large measure Johnson’s failings that led to the development of the lodestar approach by the Third Circuit. Lodestar analysis, then, represented a step forward in the evolutionary march from Johnson’s rude beginning. But certain of the lodestar methodology’s elements, in turn, eventually required refinement, as reflected in the Supreme Court’s decision in Hensley v. Eck-erhart,
Attorney’s fees jurisprudence has thus been, upon reflection, yet another evolving body of law. The law lives and learns. So too has the law governing attorney’s fees awards. The point is that attorney’s fees jurisprudence has not been placed on some Procrustean bed by the Supreme Court. To the contrary, the Court has weaved an elaborate body of law characterized by the familiar decisional-law qualities of refinement and rationalization in the same manner as other areas of adjudication. At the heart of this process has been (1) the search for the values and goals animating Congress in passing fee-shifting statutes, and (2) the evaluation and resolution of the abundant profusion of legal issues in light of those legislative goals. It especially bears noting that the evolution of the common law of attorney’s fees has not been cabined by the Three Cases highlighted so extensively by my colleagues any more than the similarly approved Johnson decision arrested the law’s development. Indeed, as the Supreme Court itself observed, the Three Cases themselves reflect a “divergence in both analysis and result.” Pennsylvania v. Delaware Valley Citizens’ Council for Clean Air, (Delaware Valley II), — U.S. -,
B
Dwelling on the Three Cases is, ultimately, unavailing. Worse, debating the extent to which Congress carved the Three Cases (sans Davis for our present purposes) into statutory stone takes the judicial eye off the real question of Laffey’s correctness. For even if the Three Cases, like Johnson, cannot stand the weight given them by my colleagues, the question remains whether Laffey itself faithfully echoes Congress’ intent. That may have been a marginally closer question at the time Laffey was handed down. But the subsequent deci-sional law leaves me with not the slightest doubt that Laffey vindicates admirably the true Congressional purpose, as divined by the Supreme Court, in fashioning the fee-shifting statutes. Congress’ real purpose was not, in my view, to stamp its seal of approval on a particular set of Delphic (in this particular) lower court cases. Its animating purpose was to enable individuals or organizations to secure competent counsel to represent them in asserting claims under statutes which Congress has seen fit to enact. The clear message of the Supreme Court in its recent cases is precisely to that effect, and therein lies Laffey’s normative strength. What some have been tormenting as an ugly duckling has turned out to be a swan.
The clearest expression of Congress’ purpose came two years after Laffey in Delaware Valley I. It is ironiс in the extreme that we today inter a decision, hard-fought at the time, which subsequently won such approbation (on other points) from the Delaware Valley I majority. And there, in the course of a careful analysis (again, of points other than the question before us today) that noted with approbation Judge Wilkey’s meticulous opinion in Laffey, the Supreme Court, speaking through Justice White, had this to say about Congress’ purposes:
[Fee-shifting] statutes were not designed as a form of economic relief to improve the financial lot of attorneys, nor were they intended to replicate exactly the fee an attorney could earn through a private fee arrangement with his client. Instead, the aim of such statutes was to enable private parties to obtain legal help in seeking redress for injuries resulting from the actual or threatened violation of specific federal laws.
The same theme was evident in Delaware Valley II. There, again speaking through Justice White, a plurality of the Court articulated the enablement goal in rejecting “enhancement for risk of loss”
Now let it not be thought that the plurality was blind to the possibility that, without such enhancements, some lawyers might see fit to decline a particular representation. But the bar in general, Justice White opined, would not turn its back on such representations, and that fact vindicated the enablement purposes animating Congress in crafting fee-shifting legislation.
The Court has re-articulated the enablement theme time and again. See, e.g., Marek v. Chesny,
The “windfall” Congress sought to avoid is the awarding of fees in excess of the rate at which qualified counsel would be willing to represent civil rights claimants who have legitimate grievances. The congressionally-mandated inquiry is thus not into the “true value” or worth of an attorney’s services. Instead, the trial court must ascertain the fee at which competent counsel would be willing to accept meritorious civil rights cases. As this court recently stated in Murray v. Weinberger, [741 F.2d 1423 (D.C.Cir.1984)] “the purpose of the statute [authorizing fee shifting in Title VII cases] is to benefit meritorious claimants — not to subsidize the legal profession.”
Laffey,
C
Enablement, not the avoidance of billing incongruities (or apparent anomalies) is the goal against which Laffey is to be measured. Enablement, not maximization of the range of private-party choice, is the Congressionally ordained purpose.
In my view, Laffey’s approach is well crafted to serve the aims of the Article I branch. An attorney’s customary billing rate provides, by definition, a sensible, rational method of achieving enablement. Private parties with grievances against the Government can, under Laffey, enlist the services of a for-profit attorney secure in the knowledge that, if success indeed lies ahead, his or her attorney’s customary rate will be recoverable in the action. Laffey’s effectuation of enablement values seems all the more manifest in light of Congress’ imposing, in the Equal Access to Justice Act, 28 U.S.C. § 2412(d), a $75 per hour (adjusted for inflation) cap, absent “special factors” which we now know are limited indeed, see Pierce v. Underwood,
Here, two of the four private attorneys who represented Save Our Cumberland Mountains (et al.) are seeking rates that are approximately 50% higher than the rates they had customarily been paid by their hourly-fee paying clients. If one is on the look-out for anomalies, this, it seems to me, could readily fall within the category of “incongruity,” if not “anomaly,” especially since Congress has set in motion a statutory fee-shifting mechanism geared to hourly rates. Indeed, upon reflection, it is evident that if a lawyer has a customary hourly rate, then that rate is at least presumptively (although not inevitably) the product of market forces, including such factors as the identity and perceived worthiness of the client and of its particular cause.
To state the obvious, it may well be (and frequently is) the case that able lawyers representing “bad” clients will charge higher rates than equally able lawyers representing “good” clients. Attorneys who make their living representing, say, organized crime chieftains, drug traffickers or socialite murderers may desire and seek the comfort and security of a premium fee to comрensate for, among other things, the relative undesirability that other attorneys might discern in such representations. To bring the point closer to home, law firms that choose to represent large for-profit corporations accused, say, of violating the environmental laws or engaging in employment discrimination may (by way of example) find it congenial (if not necessary) to offer premium starting salaries, cum bonuses, to young lawyers fresh from the rigors of law school and bar exams; likewise, young lawyers in the dewy dawn of their careers may find themselves lured by large-firm provided pots of gold at the end of the law review rainbow even if these budding young talents would prefer, all things being equal, to be representing the Lands Division or a private environmental group, say Save Our Cumberland Mountains, Inc., in environmental litigation or the EEOC or private plaintiffs in employment-discrimination matters. The point, which is sufficiently obvious to members of the legal community not to warrant further belaboring on my part, is that for a wide variety of reasons a client need not pay K Street Corridor rates to secure splendid, indeed peerless representation.
I hasten to add that Laffey did not purport mechanically or slavishly to carve the customary billable rate into statutory stone. To the contrary, Laffey features built-in prоtections that, for whatever reason, neither Mr. Yablonski nor Mr. Galloway has seen fit to invoke, namely that the customary hourly rate is only the presumptive market rate. That rate, the Laf-fey court contemplated, might well be aber-rationally high or low. Laffey,
D
As the foregoing discussion suggests, the asserted gravamen of the complaint against Laffey is that it is inconsistent with Congressional intent. The legal battleground over Laffey’s correctness is, I be
The criticism, nonetheless, is by its nature a serious one and thus merits respectful evaluation. Blum, it scarcely needs repeating, involved a recovery for attorneys’ fees under the civil rights statute, 42 U.S.C. § 1988, by attorneys from the Legal Aid Society of New York. Like other such organizations, the Society is a nonprofit, private law office. Of venerable age, the Society “enjoys a wide reputation for the devotion of its staff and the quality of its service.” Blum,
Although the case abounded with the underbrush that proliferates in attorney’s fees cases, the Supreme Court, speaking through Justice Powell, addressed only two issues. The one of relevance to our inquiry is “whether Congress intended fee awards to nonprofit legal service organizations to be calculated according to cost or to prevailing market rates.” Id. at 889,
Justice Powell then turned to the statute and its legislative history. He found there not the slightest support for a cost-related standard, as urged by New York and its many sovereign supporters. Canvassing the lower court decisions featured in the Senate Report, which I have previously had occasion to address see n. 2 supra, the Court found that “[i]n all four of the cases cited by the Senate Report, fee awards were calculated according to prevailing market rates.” Id. at 894,
Market prices of commodities and most services are determined by supply and demand. In this traditional sense there is no such thing as a prevailing market rate for the service of lawyers in a particular community.
Id. at 895 n. 11,
This discussion in Blum, it seems to me, in no way lends itself to the interpretation so heatedly pressed by appellees that fоr-profit attorneys must be paid at an hypothesized “prevailing market rate.” To the contrary, the Court took pains to recognize the abundantly obvious fact that rates among private, for-profit practitioners will vary widely. Even in an egalitarian age, Blum’s footnote 11 does not fairly support the interpretation that reviewing courts are to obliterate the manifold distinctions which abound in the legal services market and then crudely lump every practitioner of comparable experience into the same rate category. As I previously indicated, different law firms have different billing structures for a wide variety of reasons. What is more, some lawyers are actually better at lawyering than many of their colleagues of comparable experience at the bar. Everyone knows it. Clients certainly know it. And courts do too. Quite apart from billing structure, which presumably explains the lower rates charged by Messrs. Yablonski and Galloway, there is such a thing as superior skill, knowledge and ability. Rates reflect that reality of life.
All this suggests, ultimately, that the attack on Laffey revolves around deeply felt views animating much of modern-day social policy. It is the vision of equality as an ideal, equality as the watch-word to vanquish all perceived differences and disparities, that the assault on Laffey is all about; no matter that the legal world is filled with disparities that some might deem false and artificial — say, the fact that appellate judges are remunerated at higher levels than trial judges. And that brings me, at last, to the true basis of the assault on Laffey.
Ill
Upon reflection, it will be seen that the real charge laid at Laffey’s feet, and that most extensively featured by my colleagues, is that it creates anomalies. The charge is stated in the following way:
[PJrivately practicing but public interest motivated attorneys who intentionally charge their poorer clients reduced rates will receive the same reduced rates as statutory fees, even though they must depend upon the received fees for their livelihood.
Maj.Op. at 1520. Elsewhere, my colleagues put it this way: “Congress did not intend the private but public spirited rate cutting attorney to be penalized for his public spiritedness by being paid on a lower scale.” Id. at 1524.
Quite aside from my not substantial quarrel with the notions that “rate cutting” is going on here, for which there is not the slightest evidence, and that a “public spirited” attorney is being “penalized” for “public spiritedness” (when in fact the Laffey rule simply calls in even-handed fashion for the for-profit attorney presumptively to be
Indeed, the problem with the quixotic quest to rid attorney’s fees awards of anomalies is that, like other such quests, it is ultimately tilting at windmills. What is an “anomaly”? Here is a candidate for that sobriquet which is rather close to home. Some if not most judges may, at the close of another demanding day, find it anomalous that former colleagues in their respective former law firms are garnering several-fold the amount earned by federal judges. But judges have made a choice, which carries with it certain consequences that they will hopefully grin and bear. Indeed, the “anomaly” of public servants being paid a fraction of what private actors receive for “comparable” services is too manifestly evident in this community to require extended discussion. But there are, presumably, other (some might say loftier) compensations of a decidedly non-monetary nature that, to borrow a recent phrase, enriches and ennobles the daily labors of public servants, including judges, in carrying on their duties.
In sum, as to the ovеrriding concern about “anomalies,” I despair of improving upon Judge Wilkey’s response, in which the wise Judge Tamm concurred:
Laffey finds anomalous the possibility that two different law firms with lawyers of similar credentials might receive different hourly rates for work on the same case. To the extent that an anomaly exists, it mirrors the anomalous situation that would exist if the same firms were hired by a fee paying client.
IV
That brings me to the final point in Laf-fey’s defense. It works. Just the other day, the Supreme Court reminded the lower courts, who obviously face the not insubstantial daily brunt of attorney’s fees litigation, of the abiding values of the sound administration of justice in this arena of our work. Pierce v. Underwood,
Fee litigation occurs on a case to case basis and is often protracted, complicated and exhausting. There is little doubt that it should be simplified to the maximum extent possible.
Of Laffey’s high marks in this particular there can be no reasonable doubt. At considerable length, Judge Wilkey, with his vast experience as a judge, canvassed the benefits that he predicted would flow from the rule which the court there crafted. He was right on target. His discussion on this
As I understand the court’s brief response in this particular, it is two-fold: (1) ease of administration does not justify overturning Congress’ ordained methodology (a point with which I quarrel, obviously, only by virtue of its mistaken premise); and (2) since difficulty of administration did not lead the Supreme Court in Blum to abandon the fee-setting enterprise, neither can it prevent that determination on “Laffey-type facts.” Id. at 1525. With all respect, the latter response is ipse dixit accompanied by a strain of the discredited Laffey-vio\&tes-Blum theme. It fails to take into account that in Blum the only alternative to an hypothesized “prevailing rate” was a cost-based rate and that that sort of regime was squarely foreclosed by Congress’ clear intent to the contrary. It thus behooves me to repeat that neither Congress nor the Supreme Court has resolved the precise question before us and that Laffey’s answer to that question has the highly desirable effects that Judge Wil-key promised it would. The point is well captured by the Government’s brief on rehearing en banc:
This Court in Laffey predicted that the approach that it adopted would reduce fee litigation by establishing a predictable and objective standard for setting hourly rates. That prediction was accurate. * * * * Since Laffey, ... litigation over fees has been greatly reduced because of the relative ease of determining an attorney’s customary billing rate. The Laffey standard has promoted settlements and has reduced major, second round litigation over fees.
Brief for Appellants at 25.
Even apart from our practical experience under Laffey, a decent respect for precedent should counsel restraint in this area. The mere fact we agreed to reexamine Laffey does not mean that the force of precedent is out the window — even for the court sitting en banc. More should be required before abandoning a decision that has served us so well.
* * * * * *
These have thus been, in retrospect, the halcyon years for our jurisdiction in this singularly unproductive genre of litigation. Judicial ratemaking will now be re-ushered in with gusto, with countless hours undoubtedly awaiting the court as an administrative entity, complete with the requisite and entirely appropriate consultations with the bar, on how to carry on this essentially managerial task. For either we must engage in circuit-wide ratemaking, which we will be required to adjust periodically, or we will be faced with reconciling conflicting determinations of prevailing rates by various District Judges. In short, the approach in overturning Laffey that the court adopts today will create an enormous administrative burden for this court, inconsistent with the Supreme Court’s latest pronouncement. With our increasing docket summoning us to even greater productivity, I must confess to a singular want of excitement ovеr renewing the judicial focus on the level of income to be enjoyed by the distinguished bar of this jurisdiction. But with Laffey’s demise, the time is nigh to gird our loins, for the executive sessions of our court, conclaves with the bar, and policy pronunciamentos lie just around the corner. I respectfully dissent.
. Hensley, I hasten to add, canvassed the three lower court cases invoked by my colleagues for the distinct point that in each of them the plaintiffs substantially prevailed in the litigation. The question in Hensley, in contrast to the issue before us, was whether a partially prevailing plaintiff could recover fees for legal services on unsuccessful claims. Especially in light of Delaware Valley I, it seems odd to suggest, without qualification, that the Supreme Court "finally authoritatively approved the Johnson factors and the lodestar approach.” Maj.Op. at 1523. Indeed, in Delaware Valley I, after criticizing Johnson and noting the limitations of the three lower court cases, the Court stated that in Hensley "[we] ... adopted a hybrid approach that shared elements of both Johnson and the lodestar method of calculation.”
. My colleagues devote considerable energy to parsing the results and reasoning of the Three Cases. When all is said and done, I think it fair to say that the Three Cases boil down to only one decision of significant assistance to the issue that confronts us. And that is manifestly of no help to my colleagues. Davis, as the majority rightly says, is uninstructive on the issue before us. Maj.Op. at 1524. Next, Swann seems to lend itself to the same sort of debate as that swirling around constitutional or Biblical texts. As my colleagues candidly observe before launching into an exegesis on what Swann might mean, “it is not entirely clear precisely what method the Swann Court did apply.” Id. at 1523. Just so. That leaves only Stanford Daily. For that, I simply refer the reader to
Tellingly, the majority does not contradict this in the slightest. Rather, the court seeks to avoid a Stanford Daily -inspired "Charybdis" of "decreasing reasonable fees because the attorneys conducted the litigation more as an act pro bono publico than as an effort of securing a large monetary return.” Maj.Op. at 1523, quoting Stanford Daily,
. The court does say in passing that Laffey is inconsistent with Blum, Maj.Op. at 1524-25, but there is no development or argumentation on the point. As the court’s opinion stands, this is more of a glancing blow at the conclusion of its non-Blum -related analysis.
. Lest the careful reader think that I have conveniently overlooked my earlier critique of the court’s unrestrained reliance on the Three Cases, plus Johnson, sans Davis, it bears noting that the Court’s opinion in Blum v. Stenson pre-dated the Court’s own critique of those cases in Delaware Valley I.