Opinion
Nos. 79 Civ. 5831 (RLC), 79 Civ. 5899 (RLC).
July 6, 2005
RAFF BECKER, LLP, New York, New York, ROBERT L. BECKER, Of Counsel Attorneys for Plaintiffs.
ELIOT SPITZER, Attorney General of the State of New York, New York, NY, JANE DUFFY, Assistant Attorney General Of Counsel Attorneys for Defendants.
OPINION
INTRODUCTION
The law firm of Raff Becker, LLP represents plaintiffs Nadia Barcia, et al. in this action dating back to 1979. The suit was originally brought against the defendants in the form of a class action suit after the defendants improperly denied unemployment benefits and fair hearings, in violation of the Social Security Act, 42 U.S.C. § 503(a); the equal protection and due process clauses of the Fourteenth Amendment; Title VI of the Civil Rights Act of 1964, 42 U.S.C. § 2000(d); and the Federal Unemployment Tax Act, 26 U.S.C. § 3304(a)(6)(A)(i). The parties to this action entered into a consent judgment with the approval of the court on July 29, 1983. However, the defendants repeatedly failed to satisfy the terms of that decree. The plaintiffs returned to court in order to bring defendants' noncompliance to the court's attention and to compel enforcement. Defendants cross-moved to modify the consent decree to terminate monitoring of current cases by plaintiffs' counsel.
Plaintiffs prevailed on its motion for enforcement and defendants' motion for modification of the consent decree was denied and as stated in the court's opinion delivered on June 9, 2003, "plaintiffs are awarded reasonable attorney's fees, costs, and out-of-pocket expenses." Barcia v. Sitkin, 2003 WL 21345555, 11 (S.D.N.Y.). On April 7, 2004, the court issued an order awarding these attorney's fees to plaintiffs in the full amount requested in their motion and memorandum. That endorsement was later rescinded after both parties stipulated that plaintiffs' motion for attorney's fees be held in abeyance pending the outcome of the defendants' appeal of the June 9, 2003 decision to the Second Circuit.
On May 10, 2004, the Second Circuit rendered its ruling affirming in part and reversing in part the June 9, 2003 decision of the District Court. The Court affirmed the District Court's denial of defendants' motion for modification of the consent decree and reversed in part its grant of plaintiffs' motion for enforcement where it imposed supplementary obligations beyond the express terms of the consent decree. As a result, plaintiffs submitted this amended and superseding motion for attorney's fees making reductions in time for claims upon which plaintiffs did not prevail on appeal, and including time for work on matters that occurred after the June 9, 2003 order and opinion.
Plaintiffs request compensation in connection with their successful prosecution of plaintiffs' (a) motion for enforcement of the consent judgment and related relief, (b) opposition of defendants' cross-motion to terminate monitoring of current cases, (c) opposition to defendants' motion to stay relief, and (d) opposition to defendants' appeal.
Defendants oppose this award of attorney's fees and costs arguing that plaintiffs' application should be denied because plaintiffs are not prevailing parties. Defendants further argue that plaintiffs are not entitled to fees on their postjudgment motion and opposition to their cross-motion and appeal. Finally, defendants argue in the alternative that even if the court finds plaintiffs to be prevailing parties, the fee application must be drastically reduced. The court will now address each of the defendants' arguments in turn.
PLAINTIFFS' APPLICATION FOR ATTORNEY'S FEES AND COSTS SHOULD BE DENIED BECAUSE PLAINTIFFS ARE NOT PREVAILING PARTIES.
Defendants rely on Buckhannon Board Care Home, Inc. v. West Virginia Dept. of Health Human Resources, 532 U.S. 598 (2001), where the Supreme Court "drew a bright line distinguishing `prevailing parties' from plaintiffs not entitled to an award of attorneys fees." Vaughn v. Principi, 336 F.3d 1351, 1355 (Fed. Cir., 2003), cert. denied, 124 S.Ct. 2014 (2004). The court held that fees are available only when a plaintiff "obtains a judgment on the merits" or where a court order causes a "change [in] the legal relationship between [the plaintiff] and the defendant." Buckhannon, 532 U.S. at 604, citing Texas State Teachers Assn. V. Garland Independent School Dist., 489 U.S. 782, 792 (1989), which cited Hewitt v. Helms, 482 U.S. 755, 760-61 (1987); see also Preservation Coalition of Erie County v. Federal Transit Admin., 356 F.3d 444, 451 (2d Cir. 2004).
Defendants argue that where as here, the District Court denied both plaintiffs' and defendants' respective motion and cross-motion for modification (Barcia, 367 F.3d at 97) and where the Court of Appeals reversed the District Court's grant of plaintiffs' motion for enforcement (Id. at 106-110), plaintiffs cannot be deemed prevailing parties as there has been no enforceable alteration of the legal relationship between the parties. Defendants further argue that plaintiffs' successful opposition in the District Court and the Court of Appeals to the Board's cross-motion to end monitoring cannot satisfy the "change of legal relationship" requirement because "warding off" a cross-motion does not transmogrify plaintiffs into prevailing parties, as they have not prevailed on the merits of their claims or changed the legal relationship between the parties. Hanrahan v. Hampton, 446 U.S. 754, 759 (1980); Dagen v. CFC Group Holdings Ltd., 2004 U.S. Dist. LEXIS 6830 at *12 (S.D.N.Y. Apr. 21, 2004) (Motley, J.) (dismissal of defendant's counterclaim does not establish plaintiff as prevailing party).
Plaintiffs' position that they are prevailing parties is sustainable under the Buckhannon standard that defendants cited above. Plaintiffs have obtained an enforceable judgment that requires defendants to bring the manner in which they conduct hearings into compliance with the consent judgment. The judgment, and the ability to enforce it, has altered the legal relationship between the parties and forbids the defendants from arbitrarily depriving claimants who do not appeal their cases from receiving the benefits of the consent judgment. Thus, the legal relationship between plaintiffs and the defendants have been sufficiently altered to regard plaintiffs as prevailing parties thereby justifying the awarding of attorney's fees.
PLAINTIFFS ARE NOT ENTITLED TO FEES ON THEIR POSTJUDGMENT MOTION AND OPPOSITION TO THE BOARDS' CROSS-MOTION AND APPEAL.
Defendants do not dispute that the initial consent judgment approved by the court on July 29, 1983 established plaintiffs as prevailing parties at that time but argue that such status does not exist for the life of the consent judgment, no matter what the outcome of postjudgment litigation. See, e.g., Alliance to End Repression v. City of Chicago, 356 F.3d at 767 (Posner, J.) (initial success in obtaining consent decree does not grant prevailing party status for life of decree, where postjudgment proceedings were not successful); Cody v. Hillard, 304 F.3d 767, 773 (8th Cir. 2002) (plaintiff's once-established prevailing party status does not make all later work compensable).
However, as plaintiffs correctly point out, case law and the plain language of 42 U.S.C. 1988 clearly state that attorney's fees can be awarded for post-judgment monitoring and other efforts to ensure compliance with court orders in a civil rights case. Duran v. Carruthers, 885 F.2d 1492, 1495 (10th Cir. 1989) (awarding fees and finding that consent decree "was only the beginning, and counsel for the plaintiffs has a continuing duty and responsibility to make sure that the defendants comply, and continue to comply, with the decree");Adams v. Mathis, 752 F.2d 553, 554 (11th Cir. 1985); Garrity v. Sunun, 752 F.2d 727, 738 (1st Cir. 1984); Miller v. Carson, 628 F.2d 346, 348 (5th Cir. 1980); Northcross v. Board of Educ., 611 F.2d 624, 637 (6th Cir. 1979), cert. denied, 447 U.S. 911, 64 L.Ed.2d 862, 100 S.Ct. 2999, 100 S.Ct. 3000 (1980).
In Plyler v. Evatt, 902 F.2d 273 (4th Cir. 1990) the court noted that "entitlement to fees for one aspect of a protracted litigation does not turn narrowly on whether the party prevailed on that particular matter, but whether a separate claim or, as here, a separate proceeding is so unrelated as to justify treating it as a `separate lawsuit'". 902 F.2d at 280 (quotingHensley v. Eckerhart, 461 U.S. 424, 435 (1983)). The court further noted that:
The Supreme Court has directed district courts not to draw overly fine distinctions in making this determination. Certainly where the issues presented in the later proceedings or in separate claims involve the same common core of facts or related legal theories, the case "cannot be viewed as a series of discrete claims. Instead the district court should focus on the significance of the overall relief obtained by the plaintiff in relation to the hours reasonably expended on the litigation."902 F.2d at 280 (quoting Hensley, 461 U.S. at 435).
On the basis of these principles the court observed that plaintiffs, who had been successful in negotiating the consent decree, had engaged in the later litigation to "preserve its fruits." Plyler v. Evatt, 902 F.2d at 281. The court also noted: "Plaintiff class had no option but to incur the related costs; plaintiffs' counsel were under clear obligation to make the defensive effort." Id. It therefore concluded:
To deny attorney fees for such an effort, whether successful in detail or not, would obviously thwart the underlying purpose of the attorney fee provision of 42 U.S.C. § 1988.Id.
When, as here, the matters at issue in subsequent litigation are "so intertwined with the original claims that attorney's fees for work on those proceedings should be awarded as to a still prevailing party." Id. Plaintiffs position is further bolstered by the fact that they were actually successful in their efforts to preserve the fruits of earlier litigation.
IF THE COURT FINDS PLAINTIFFS TO BE PREVAILING PARTIES, THE FEE APPLICATION MUST BE DRASTICALLY REDUCED.
Defendants argue that even if the court agrees to award plaintiffs attorney's fees, given their very modest success, those fee award must be reduced across-the-board by at least five-sixths. Comparing what plaintiffs asked for, the imposition of their amelioration plan and at least three enforcement measures with their receipt of injunctive relief, the court may find that they can be said to have prevailed on approximately one-sixth of their requests. See, e.g., Betancourt v. Giuliani, 2004 U.S. Dist. LEXIS 13245 (S.D.N.Y. July 14, 2004) (fee application reduced 90% due to limited success.)
Defendants do not contest the reasonableness of the hours spent or the hourly rates of plaintiffs counsel. Their reasoning for a reduction lie with plaintiffs' limited success. In answer to that assertion, plaintiffs secured an order requiring defendants to submit a new plan to come into compliance with the consent judgment and to provide benefits to all claimants that are entitled to benefits of the decree. This relief will undoubtedly require defendants to modify the way it adjudicates claims for unemployment insurance benefits and thus cannot be construed as a limited success.
In Hensley v. Eckerhart, 461 U.S. 424, 440 (1983), the Supreme Court advised that when a plaintiff is unsuccessful on a claim that is separate and distinct from the successful claims, "the hours spent on the unsuccessful claim should be excluded in considering the amount of a reasonable fee." That is precisely what plaintiffs here have done and what defendants have ignored in their "five-sixth across-the-board" reduction.
CONCLUSION
For the aforementioned reasons the court hereby grants plaintiffs' amended and superseding application for attorney's fees and costs in the full amount requested in their motion and memorandum.
IT IS SO ORDERED