Opinion
01 Civ. 9290 (RWS)
July 10, 2002
LIDDLE ROBINSON New York, NY., BLAINE H. BORTNICK, ESQ. For Plaintiff.
NOMUPA SECURITIES INTERNATIONAL, INC., Two World Financial Center, Building B New York, NY., DECHERT PRICE RHOADS, JANET BROECKEL, ESQ. Attorney for Defendants.
OPINION
Plaintiff Darnell Wilson ("Wilson") has moved for the payment of his attorney's fees, having accepted a Rule 68 offer by Nomura Securities International, Inc. ("Nomura"), Frank Zayas ("Zayas") and Anton Appel ("Appel") (collectively, "Nomura") to settle his discrimination action. For the reasons set forth below, the motion is granted in part and denied in part.
Prior Proceedings
Wilson initiated this action on October 22, 2001 against Nomura following the termination of his employment as a porter, alleging discrimination in violation of: Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq. ("Title VII"); the Civil Rights Act of 1866, 42 U.S.C. § 1981 ("Section 1981"); the New York State Executive Law § 296 et seq. ("New York State Human Rights Law"); and the Administrative Code of the City of New York § 8-101 et seq. ("New York City Human Rights Law").
A pretrial conference setting a discovery and pretrial order schedule was held on January 30, 2002. On January 31, 2002, Nomura served Wilson with a Rule 68 Offer of Judgment (the "Offer of Judgment") which stated:
Pursuant to Federal Rule of Civil Procedure 68, Defendants Nomura Securities International, Inc., Frank Zayas, and Anton Appel make an offer to allow judgment to be taken against them in the amount of $15,000.00 inclusive of all costs available under all local, state or federal statutes accrued to date.
On February 8, 2002, Wilson accepted this offer.
This motion for a judgment in his favor in the amount of $15,000 plus attorney's fees as a prevailing party was heard and marked submitted on March 27, 2002.
Discussion
I. Wilson Is Entitled To Attorneys' Fees In Addition to the Amount in the Offer of Judgment
Rule 68 of the Federal Rules of Civil Procedure provides that "[a]t any time more than 10 days before the trial begins, a party defending against a claim may serve upon the adverse party an offer to allow judgment to be taken against the defending party for the money or property or to the effect specified in the offer, with costs then accrued." The term "costs" under Rule 68 means costs properly awardable under the relevant substantive statute or other authority. Marek v. Chesny, 473 U.S. 1, 7, 105 S.Ct. 3012, 87 L.Ed.2d 1 (1985). Where the underlying statute which governs a plaintiff's claim defines "costs" to include attorneys' fees, such fees are to be included as costs for purposes of Rule 68. Id. at 9.
The Rule 68 Offer of Judgment at issue in the instant motion included "all costs available under all local, state or federal statutes accrued to date." Wilson contends that the term "costs" as used in the Offer of Judgment does not include attorney's fees.
One of the statutes under which Wilson brought his claim, Title VII, expressly includes attorney's fees in its definition of "costs." See 42 U.S.C. § 2000e-5 (k) (2001) ("[T]he court, in its discretion, may allow the prevailing party . . . a reasonable attorney's fee (including expert fees) as part of the costs."); Lyte v. Sara Lee Corp., 950 F.2d 101, 103 (2d Cir. 1991); see also Delta Air Lines, Inc. v. Auciust, 450 U.S. 346, 362-363, 101 S.Ct. 1146, 1155— 1156, 67 L.Ed.2d 287 (1981) (Powell, J., concurring). Wilson has contended that he is entitled to attorney's fees under Title VII above and beyond those included within the offer based upon an amendment to Title VII passed in 1991, 42 U.S.C. § 2000e-5 (g)(2)(B) and its interpretation in Gudenkauf v. Stauffer Communications, Inc., 158 F.3d 1074 (10th Cir. 1998).
Section 2000e-5(g)(2)(B) provides:
On a claim in which an individual proves a violation under § 2000e-2(m) of this title and respondent demonstrates that the respondent would have taken the same action in the absence of the impermissible motivating factor, the court — (i) may grant declaratory relief, injunctive relief (except as provided in clause (ii)), and attorney's fees and costs demonstrated to be directly attributable only to the pursuit of a claim under § 2000e-2(m) of this title; and (ii) shall not award damages or issue an order requiring any admission, reinstatement, hiring, promotion, or payment, described in subparagraph (A).
The text of the statute, as well as the discussion in Gudenkauf, establish that § 2000e-5(g)(2)(B) was added to Title VII specifically to address the situation in which the plaintiff does not receive a damages award but nonetheless serves a public purpose by proving that the defendant acted with discriminatory intent. 158 F.3d at 1080-81.
There is no mention of § 2000e-2(m) in the complaint, and, unlikeGudenkauf, there has been no factual determination of a mixed motive,i.e. that illegal discrimination was a motivating factor in the adverse employment action but the action would have been taken even absent the illegal motive. Gudenkauf, 158 F.3d at 1077. Without more, there is nothing in the present record indicating that Section 2000e-5(g)(2)(B) applies to the instant action.
A review of the provisions of the New York City Human Rights Law, however, reveals that there is a separate statutory basis for awarding Wilson attorney's fees beyond the "costs" provided for in the Rule 68 Offer of Judgment. That statute provides, in relevant part, that "the court . . . may award the prevailing party costs and reasonable attorney's fees." Administrative Code of the City of New York § 8-502(e). Accordingly, if Wilson is a prevailing party, and the language of the accepted Offer of Judgment does not by its terms provide to the contrary, he may be entitled to reasonable attorney's fees separate and apart from the $15,000 offered by Nomura.
As the Second Circuit has stated in the context of a Title VII action, a plaintiff is a "prevailing party" when he or she "succeeds on any significant issue in litigation which achieves some of the benefit" the party sought in bringing suit. Bridges v. Eastman Kodak Co., 102 F.3d 56, 58 (2d Cir. 1996) (internal quotations and citations omitted); see also Farrar v. Hobb, 506 U.S. 103, 109, 113 S.Ct. 566, 571-72, 121 L.Ed.2d 494 (1992); Carroll v. Blinken, 42 F.3d 122, 129 (2d Cir. 1994). Courts have defined "succeeds" when there is relief on the merits of the claim which materially alters the parties' legal relationship, benefitting the plaintiff. See Foster v. Kings Park Central School District, 174 F.R.D. 19, 25 (citing Bridges, 102 F.3d at 58).
"A plaintiff involved in litigation ultimately resolved by settlement may still be entitled to an award of attorney's fees." Lyte v. Sara Lee Corporation, 950 F.2d 101, 103-04 (2d Cir. 1991). In Lyte, the plaintiff accepted the defendant's offer of judgment of $9,500 and moved for attorney's fees as the prevailing party. The Second Circuit held that the plaintiff had received a benefit sought in the complaint from the $9,500 payment, and that this settlement was clearly a resolution that changed the legal relationship between the parties. 950 F.2d at 103-04. The Second Circuit went on to hold that such a payment was not "de minimis" or "technical" such that prevailing party status would not be warranted.Id. at 104.
A similar result was reached in Foster, where the defendant argued that the $14,000 settlement offered to the plaintiff was merely a nuisance value and therefore the plaintiff should not be awarded attorney's fees. 174 F.R.D. at 25. The defendant further noted in support of its position that the plaintiff sought $14,070 in fees exclusive of costs, and given that the fee application was greater than the actual settlement, the plaintiff should not receive a monetary benefit from the offer of judgment. Id. This argument was rejected in view of Lyte. Id.
In this case, Wilson received an Offer of Judgment of $15,000. This offer is greater than the $9,500 amount offered in Lyte and the $14,000 amount offered in Foster. In addition, the amount offered is approximately two-thirds of Wilson's annual salary of $23,000. In accepting, Wilson obtained not an insubstantial amount in monetary damages, the principal relief which he sought in the complaint. See Lyte, 950 F.2d at 104 (If the relief obtained is "of the same general type" as the relief demanded in the complaint, a plaintiff may be considered to be a "prevailing party.") (quoting Koster v. Perales, 903 F.2d 131, 134-35 (2d Cir. 1990). In light of these facts and the authorities cited, Wilson is the prevailing party and, therefore, under the New York City Human Rights Law, is eligible to receive attorney's fees apart from his costs.
Wilson's annual salary was approximately $30,000 with overtime and bonus payments.
II. The Attorney's Fees Are Reduced
The amount of the attorney's fees awarded must be reasonable and must be determined on the specific facts of this case. Hensley v. Eckarhart, 461 U.S. 424, 430, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983). The standard guiding the determination of what constitutes a reasonable fee is the same under both the New York City Human Rights Law and other similar federal statutes. See Shannon v. Fireman's Fund Ins. Co., 156 F. Supp.2d 279, 298 (S.D.N.Y. 2001) (citing McIntyre v. Manhattan Ford, LincolnMercury, Inc., 176 Misc.2d 325, 672 N.Y.S.2d 230, 231— 32 (N.Y.Sup.Ct. 1997). Accordingly, the first step in assessing Wilson's requests is to calculate the lodestar amount.Quaratino v. Tiffany Co., 166 F.3d 422, 425 (2d Cir. 1999) (citing Hensley, 461 U.S. at 433).
In calculating the fees to be awarded under the lodestar method, the hours reasonably expended by counsel are multiplied by a reasonable hourly rate. Id. at 433. This amount is "strongly presumed to be reasonable." Quaratino, 166 F.3d at 425. However, adjustments may be made as necessary according to the particular facts of the case. See Blum v. Stenson, 65 U.S. 886, 888, 104 S.Ct. 1541, 79 L.Ed.2d 891 (1984). The party seeking fees bears the burden of showing that the claimed rate and number of hours worked are reasonable. See id. at 897; Shannon, 156 F. Supp.2d at 299.
According to Wilson, 156.25 hours of time was allocated among the six primary attorneys working on the instant case, resulting in fees totaling $35,325.00. The fees range from $125 per hour for James Malhos to $525 per hour for Jeffrey L. Liddle, a founding partner of his firm. The defendants do not challenge the reasonableness of the attorneys' hourly rates, but do contest the reasonableness of the time spent on legal services.
"Hours that are `excessive, redundant, or otherwise unnecessary,' are to be excluded [from the fee calculation]; and in dealing with such surplusage, the court has discretion simply to deduct a reasonable percentage of the number of hours claimed `as a practical means of trimming fat from a fee application.'" Kirsch v. Fleet Street, Ltd., 148 F.3d 149, 173 (2d Cir. 1998) (internal citations omitted); see also, e.g., Sowemimo v. D.A.O.R. Sec., Inc., No. 97 Civ. 1083 (RLC), 2000 WL 890229, at *4 (S.D.N.Y. June 30, 2000) (reducing number of hours by 20% to protect defendants from being penalized by counsel's "inadequate recordkeeping or the time plaintiff's counsel wasted on extraneous tasks") . Given the circumstances of this case, the number of hours billed must be reduced from the $35,325.00 sought by Wilson.
First, certain of the time billed by Wilson's counsel is duplicative, particularly with respect to the drafting of the EEOC charge and the drafting of the complaint, the latter taking up at least 35 hours of billable hours while the former took 16 hours to draft. While Wilson claims that this time is reasonable, the complaint is virtually identical in most respects to the EEOC charge, save minor variations such as the removal of a religious discrimination charge, the addition of "upon information and belief" clauses, and the changing of subjects from the first person to the third person.
Second, much of the information provided is vague or otherwise unhelpful in helping Wilson meet his burden of establishing the reasonableness of the fees. For instance, the entries for Liddle offer no description other than the client's name. Another lawyer, Leila Noor, entered vague or simple descriptions such as "Complaint," "Reading File," or "EEOC Charge," revealing little about how her time was actually spent. See Skold v. Am. Int'l Group, 96 Civ. 7137 (HB), 1999 WL 405539 (S.D.N.Y. Jun. 18, 1999); Sowemimo, 2000 WL 890229, at *4; Gonzalez v. Bratton, 147 F. Supp.2d 180, 213 (S.D.N.Y. 2001). The entries for three others listed as "primary attorneys" reflected that they spent less than one hour on the case, and Wilson has not met his burden of explaining how this labor would be necessary for a case of this size. See Rodriguez v. McLoucrhlin, 84 F. Supp.2d 417, 424 (S.D.N.Y. 1999).
Finally, the record demonstrates that many of the tasks that were attributed to more senior lawyers could have been more appropriately handled by younger associates or secretaries. The billing records for Blame Bortnick, who spent over fifty hours on this case at a rate of $350 to $400, show that he performed tasks such as research regarding a confidentiality agreement on January 31, 2002 and preparing Wilson's acceptance of the Offer of Judgment for service on February 7, 2002. Bortnick and fellow attorney Leila Noor also each spent excessive time reviewing a one-sentence stipulation regarding an extension of time for the defendants to respond to the complaint. And Noor performed such clerical tasks as "calendaring" and "looking for file," and billed for time spent on filing the complaint and affidavit of service. See Sowemimo, 2000 WL 890229, at *7 ("As a general rule, an attorney's filing, delivery, and service of papers do not properly come under the heading of hours expended on the litigation and are not generally considered recoverable expenditures of time.") (internal quotations and citation omitted).
For these reasons and inefficiencies related to time spent communicating with opposing counsel and in the preparation and attendance at the pretrial conference of January 29, 2002, a reduction in the hours attributed to Wilson's counsel is warranted to insure that the defendants are not penalized by inefficiencies and excessive billing. Accordingly, a 50% across-the-board reduction is appropriate, yielding a recalculated figure of $17,228.26 in attorneys's fees.
In calculating this amount, a 50% across-the-board reduction yielded the following hours attributed to each attorney: Jeffrey Liddle: 0.5; Blame Bortnick: 25.125; Leila I. Noor: 51.875; James Malhos: 0.375; Candace Adiutori: 0.125; Christina Kang: 0.125. The average hourly rates of $506.25, $376.14, and $143.45 were used in calculating the fees for Liddle, Bortnick, and Noor, respectively.
Although the lodestar calculation is presumptively reasonable, the Supreme Court has indicated that "[t]he product of reasonable hours multiplied by a reasonable rate does not end the inquiry." Hensley, 461 U.S. at 434. In considering an adjustment to the calculation to arrive at a "reasonable" fee in civil rights cases, the district court may consider the results that have been obtained, see id., and the factors that were set forth in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir. 1974). However, many of these factors are subsumed within the initial lodestar calculation, see Hensley, 461 U.S. at 434 n. 9, and neither party has argued that the lodestar amount should be adjusted based on such equitable factors. Accordingly, no further adjustments have been made to the corrected lodestar amount.
Those factors include: (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 results obtained; (9) the experience, reputation, and ability of the attorney; (10) the "undesirability" of the case; and (11) the nature and length of the professional relationship of the client; and (12) awards in similar cases. See Johnson, 488 F.2d at 717-19.
Conclusion
The motion for fees is granted and the fees are reduced to $17,228.26.