Opinion
93 Civ. 0878 (PKL)
August 27, 2001
Jennifer M. Green, Esq., Anthony P. DiCaprio, Esq., Judith Brown Chomsky, Esq., CENTER FOR CONSTITUTIONAL RIGHTS, Cynthia Soohoo, Esq., COVINGTON BURLING, Denis F. Sheils, Esq., Nadia Ezzelerab, Esq., KOHN, SWIFT GRAF, P.C., Theresa M. Traber, Esq., TRABER, VOORHEES OLGUIN, James J. Silk, Esq., Ronald C. Slye, Esq., Gregory H. Fox, Esq., Heather J. Friedman, Esq., Paul R. Dubinsky, Esq., ALLARD K. LOWENSTEIN INTERNATIONAL HUMAN RIGHTS CLINIC YALE LAW SCHOOL. Attorneys for Plaintiffs.
OPINION AND ORDER
Plaintiffs, twenty-two Muslim citizens of Bosnia-Herzegovina, brought this action seeking compensatory and punitive damages for acts of genocide, including murder, rape, torture, and other torts, committed in Bosnia-Herzegovina by individuals under the command and control of defendant Radovan Karadzic. After a two-week jury trial in September 2000, a jury awarded plaintiffs approximately $4.5 billion in compensatory and punitive damages. In the instant motion, plaintiffs seek attorneys' fees in the amount of $2,193,807 and costs totaling $137,429.14. For the following reasons, plaintiffs' motion is denied.
BACKGROUND
The facts of this case are examined in great detail in Kadic v. Karadzic, 70 F.3d 232 (2d Cir. 1995). Therefore, only those facts relevant to the instant motion are discussed herein. In February of 1993, plaintiffs brought this action for compensatory and punitive damages against Karadzic for genocide, war crimes, crimes against humanity, and other human rights abuses committed by forces under defendant's command and control in the self-proclaimed Bosnian-Serb state of"Srpska." Plaintiffs alleged that Karadzic acted in an official capacity as either the titular head of Srpska or in collaboration with the government of Bosnia-Herzegovina and its dominant constituent republic, Serbia. Karadzic was served with a summons in New York City in early 1993, while visiting the United Nations as a diplomatic invitee. Subject matter jurisdiction over this action was based on the Alien Tort Claims Act (hereinafter "ATCA"), 28 U.S.C. § 1350; the Torture Victim Protection Act of 1991 (hereinafter "TVPA"), Pub.L. No. 102-256, 106 Stat. 73(1992) (codified at 28 U.S.C. § 1350); 28 U.S.C. § 1331; and principles of supplemental jurisdiction. On June 14th, 2000, this Court issued a default judgment against defendant after he failed to comply with discovery obligations and to appear before the court, and instead stated his intent not to participate in further proceedings in this action. Therefore, plaintiffs proceeded with a trial solely to determine the amount of damages to be awarded against defendant.
During the seven year course of this litigation, plaintiffs were represented by a number of attorneys associated with the Center for Constitutional Rights (hereinafter "CCR"). These attorneys — William Goodman, Esq., Judith Chomsky, Esq., Beth Stephens, Esq., Jennifer Green, Esq., Jaykumar Menon, Esq., and Anthony DiCaprio, Esq. — have submitted affidavits and detailed time records documenting their work on this case. In total, CCR attorneys billed $914,615 in attorneys' fees and $97,344.56 in costs during the course of this action. In addition, plaintiffs were also represented by Theresa M. Traber, Esq., of Traber, Voorhees Olguin; Denis F. Sheils, Esq., of Kohn, Swift Graf, P.C.; and Cynthia Soohoo, Esq., of Covington Burling. Based on their time records and affidavits, Traber, Voorhees Olguin billed $129,270 in attorneys' fees and $1407.39 in costs; Kohn, Swift Graf billed $200,327,50 in attorneys' fees and $14,041.50 in costs; and Covington Burling billed $639,594.50 in attorneys' fees and $23,071.24 in costs during the course of this action. Finally, plaintiffs received additional representation from attorneys associated with the Allard K. Lowenstein International Human Rights Clinic at Yale Law School. The Lowenstein Clinic billed $310,000 in fees for its five attorneys who worked on this case. In total, plaintiffs request attorneys' fees in the amount of $2,193,807 and cost reimbursement totaling $137,429.14. Plaintiffs also request a 50% upward adjustment of this figure based on the complexity of the case and the results achieved by plaintiffs.
DISCUSSION
Plaintiffs contend that they are entitled to attorneys' fees pursuant to (1) 28 U.S.C. § 1350; (2) the Court's inherent power to grant such fees and (3) the laws of the State of New York. The Court will consider each argument in turn.
A fundamental aspect of the United States judicial system is the requirement that parties provide for their own costs associated with litigation. Indeed, under the "American Rule," "absent statute or enforceable contract, litigants pay their own attorneys' fees." See Alveska Pipeline Serv. Co. v. The Wilderness Soc'y. 421 U.S. 240, 247(1975). Plaintiffs argue that, although the statutory language of the ATCA does not expressly permit a prevailing party in such an action to obtain attorneys' fees, the statute was intended to be modeled after The Civil Rights Attorney's Fee Act of 1976, codified as 42 U.S.C. § 1988.See Plaintiffs' Memorandum of Law in Support of Plaintiffs' Application for Attorneys' Fees (hereinafter "Pls.' Mem.") at 1. "In a sense," plaintiffs argue, "attorneys' fees awards in human rights litigation are analogous to, and perhaps indistinguishable from, the purposes of granting prevailing plaintiffs attorneys' fees in civil rights actions." Pls.' Mem. at 4. Therefore, since § 1988 allows for "the court, in its discretion, [to] allow the prevailing party . . . a reasonable attorney's fee as part of the costs" in civil rights cases, 42 U.S.C. § 1988(b), plaintiffs contend that prevailing parties should likewise obtain reimbursement for attorney's fees under § 1350.
Plaintiffs' argument, however, fails to account for the fact that Congress chose, for whatever reason, not to include a fee-shifting provision in § 1350. Indeed, if Congress had intended for a prevailing party under § 1350 to be entitled to an award of attorneys' fees, it could have written such an award into the statute itself. See Alyeska, 421 U.S. at 263 ("Congress itself presumably has the power and judgment to pick and choose among its statutes and to allow attorneys' fees under some, but not others."). While the Court does not doubt "that Congress intended to support ATCA jurisprudence brought against those who committed other gross violations of human rights," Pls.' Mem. at 4, this does not mean Congress authorized an award of attorneys' fees in such jurisprudence. In fact, plaintiffs have cited no case — nor has the Court found any in its own research — that granted attorneys' fees to a prevailing party under § 1350.
Plaintiffs also assert that "the broad grant of authority to award attorneys' fees to litigants seeking to protect federally protected interests extends to beyond cases where 'traditional' civil rights are violated and includes federal statutory rights as well." Pls.' Mem. at 2. To support this contention, plaintiffs cite Thorsten v. Barnard, 883 F.2d 217 (3d. Cir. 1989), in which the Third Circuit extended the right to attorneys' fees under § 1988 to plaintiffs' claim under 48 U.S.C. § 1561. See id. at 218. Plaintiffs' reliance on Thorsten, however, is misplaced. For while the district court awarded attorneys' fees for the § 1561 claim, it did so only because the plaintiffs could have invoked § 1983, "which, in turn, [triggers] the applicability of § 1988." Id. Therefore, Thorsten did not open the door to extend attorneys' fees to every case in which plaintiffs seek to vindicate federal rights, as plaintiffs suggest.
Plaintiffs next argue that if a fee-shifting remedy is not read into the ATCA and TVPA, the statutes "are in danger of becoming 'mere hollow pronouncements which the average citizen cannot enforce.'" Pls.' Mem. at 6. While the Court recognizes plaintiffs' concerns, the Court cannot haphazardly decide, without statutory authorization, that § 1350 is more important than other statutes and therefore requires a fee-shifting provision. See Alyeska, 421 U.S. at 269 ("[C]ourts are not free to fashion drastic new rules with respect to the allowance of attorneys' fees to the prevailing party in federal litigation or to pick and choose among plaintiffs and the statutes under which they sue and to award fees in some cases but not in others, depending upon the courts' assessment of the importance of the public policies involved in particular cases."). Thus, plaintiffs' claim for attorneys' fees pursuant to the ATCA and TVPA is not persuasive.
II. Inherent Powers of the Court
Plaintiffs also contend that the Court should award attorneys' fees pursuant to its inherent power. See Pls.' Mem. at 6. Specifically, plaintiffs argue that this Court should apply the "bad faith exception," and award attorneys' fees here because defendant "failed to comply with discovery orders, to cooperate in any other aspect of the litigation, and failed to appear for trial." Id. at 8.
In Alyeska, the Supreme Court enumerated three exceptions to the American Rule which manifest "assertions of inherent power in the courts to allow attorneys' fees in particular situations." 421 U.S. at 259; see also Chambers v. NASCO. Inc., 501 U.S. 32, 45-46(1991). The first exception is the "common fund exception," which provides for attorneys' fees when the prevailing party's pursuit of the litigation confers a benefit on individuals not involved in the suit. See Alyeska, 421 U.S. at 257. The second exception authorizes courts to award attorneys' fees for "willful disobedience of a court order." Id. at 258. Third, and most relevant for the instant motion, courts may assess attorneys' fees when a party has "acted in bad faith, vexatiously, wantonly, or for oppressive reasons." Id. at 258-59 (internal quotations omitted). The Second Circuit requires a "'high degree of specificity in the factual findings of lower courts when attorneys' fees are awarded on the basis of bad faith. . . .'" Kanematsu-Gosho Ltd. v. M/T Messiniaki Aigli, 814 F.2d 115, 119 (2d Cir. 1987) (quoting Weinberg v. Kendrick, 698 F.2d 61, 80 (2d Cir. 1982), cert. denied, 464 U.S. 818(1983)). Moreover, sanctions pursuant to the bad faith exception are not appropriate without "clear evidence" that "the challenged actions are (1) 'entirely without color' and (2) motivated by 'improper purposes,' such as harassment or delay."Milltex Indus. Corp. v. Jacquard Lace Co., Ltd., 55 F.3d 34, 38 (2d Cir. 1995) (quoting Oliveri v. Thompson, 803 F.2d 1265, 1272 (2d Cir. 1986)); see also Nemeroff v. Abelson, 620 F.2d 339, 348 (2d Cir. 1980). "The test is conjunctive and neither meritlessness alone nor improper purpose alone will suffice." Sierra Club v. U.S. Army Corps of Engineers, 776 F.2d 383, 390 (2d Cir. 1985),cert. denied, 475 U.S. 1084(1986). Finally, the Supreme Court has cautioned that, "because of their very potency, inherent powers must be exercised with restraint and discretion." Id. at 44. For example, in NASCO, the Supreme Court upheld a district court's decision to impose attorneys' fees as a "bad faith" sanction on a defendant for behavior that included (1) attempts to deprive the court of jurisdiction through acts of fraud, (2) the filing of false and frivolous pleadings and (3) acts of delay and harassment to induce the plaintiff into compliance. See NASCO, 501 U.S. at 41.
Plaintiffs do not contend that the first two exceptions pertain here, nor does the Court find either applicable to this case.
Here, although the Court is cognizant of the fact that defendant defaulted after four years of litigation, and was not cooperative in complying with discovery requests prior to his default, defendant's actions fail to meet the stringent requirements to warrant an award of attorneys' fees under the bad faith exception. The Court is unwilling to characterize defendant's noncooperation as an affirmative act that is "meritless," and "motivated by improper purposes." Defendant simply refused to mount any further defense in this action, which led the Court to enter a default judgment against him. While defendant did nothing to assist in the expeditious litigation of this matter, defendant's actions — or lack thereof — certainly cannot be considered conduct which abuses the judicial process." Alyeska at 44-45. Moreover, given the exceptional circumstances surrounding this case, it was indeed foreseeable that defendant might not appear before the Court at any point during the litigation. Therefore, plaintiffs' argument that the Court should use its inherent power to assess attorneys' fees against defendant is unpersuasive.
III. New York State Law
Plaintiffs' final argument is that they are entitled to an award of attorneys' fees pursuant to New York State Law. Plaintiffs note that "the inherent power of New York courts to add an exception to the American Rule in the appropriate circumstances has been recognized by the New York Court of Appeals." Pls.' Mem. at 9. Plaintiffs contend that there are "two distinct and compelling bases for an attorneys' fee award: (1) the barbaric, egregious and evil acts of the defendant and those acting on his orders warrant such a holding, and (2) the policy considerations upon which ACTA and TVPA are predicated." Pls.' Mem. at 9-10.
While plaintiffs are correct that the New York Court of Appeals has recognized exceptions to the American Rule, the recognized exceptions are not applicable here. See Mighty Midgets. Inc., v. Centennial Ins. Co., 47 N.Y.2d 12, 22(1979). In Mighty Midgets, the New York Court of Appeals noted that the refusal to award attorneys' fees to prevailing parties "reflects a fundamental legislative policy decision . . . save for a few exceptions," 47 N.Y.2d at 22, and cited section 8303 of the New York Civil Practice Law and Rule (hereinafter "CPLR") as containing New York's recognized exceptions to the American Rule. See id. Section 8303 permits the recovery of attorneys' fees in situations that include (1) mortgage foreclosures, (2) difficult or extraordinary cases where a defense has been interposed, and (3) partitions of real property. See CPLR § 8303. Clearly, none of these exceptions has any bearing on the facts of this case. Further, § 8303 does not dispute that "it is well established that in the absence of specific statutory authority counsel fees are merely incidents of litigation and thus are not compensable." In the Matter of Elfriede Green, 51 N.Y.2d 627, 629-630 (1980) (internal quotations omitted); see also Mighty Midgets, 47 N.Y.2d at 21-22 ("[I]t has now long been the universal rule in this country not to allow a litigant to recover damages for the amounts expended in the successful prosecution or defense of its rights."). The Mighty Midgets recognition of exceptions under § 8303, therefore, does not support plaintiffs' conclusion that "New York courts may award attorneys' fees as an element of punitive damages." Pls.' Mem. at 9.
Plaintiffs further argue that the heinousness of the defendant's crimes warrants the imposition of attorneys' fees as a form of punitive damages. In support of their position, they cite dicta from Russian Church of Our Lady of Kazan v. Dunkel, 326 N.Y.S.2d 727 (Sup.Ct. 1971), which states that "expenses of litigation including attorneys' fees may be considered not as compensation but as punishment for wrongful and malicious acts." Id. at 757. However, Russian Church did not actually grant attorneys' fees to the plaintiff in that case. See id Further, plaintiffs do not cite any case — nor has research revealed one — that has awarded attorneys' fees as a form of punitive damages pursuant to New York state law. Moreover, Russian Church was decided prior to Green and Mighty Midgets, which clarified New York law on this issue. The emphasis Green and Mighty Midget placed on the American Rule surely calls into question the dicta of Russian Church. Indeed, the Supreme Court has since emphasized that attorneys' fees should be used as a sanction for a party's action before the court, not as a punishment for the underlying action. See NASCO, 501 U.S. at 54 (affirming the district court's decision to sanction the petitioner not for his breach of contract, which led to the litigation itself, but "for the fraud he perpetrated on the court and the bad faith he displayed"). Therefore, the Court is not persuaded that attorneys' fees are available, much less appropriate, under the laws of New York. Hence, the Court declines to award plaintiffs attorneys' fees pursuant to New York law.
The Court wishes to commend plaintiffs' attorneys for their exceptional representation of their clients and presentation of the underlying evidence in this case, which established beyond peradventure of doubt defendant's complicity in the alleged human rights abuses. However, the Court is unable to award plaintiffs attorneys' fees in this case. Accordingly, plaintiffs' motion for attorneys' fees is denied.
CONCLUSION
For the foregoing reasons, plaintiffs' motion for attorneys' fees is DENIED.