Jordan v. Fusari
| Decision Date | 26 August 1975 |
| Docket Number | Civ. No. 15671. |
| Citation | 422 F. Supp. 1179 |
| Court | U.S. District Court — District of Connecticut |
| Parties | Sabine D. JORDAN, Individually and on behalf of all other persons similarly situated v. Jack A. FUSARI, Commissioner of Labor and Administrator, Unemployment Compensation Act. |
Louise G. Trubek, Eugene N. Sosnoff, James C. Whitney, Peter B. Cooper, Sosnoff, Cooper & Whitney, New Haven, Conn., for plaintiff.
Donald E. Wasik, Asst. Atty. Gen., Labor Dept. (AG-7), Hartford, Conn., for defendant.
This civil rights class action was commenced on March 8, 1973, challenging the constitutionality of Conn.Gen.Stat. § 31-236(5), which disqualified women from receiving unemployment compensation benefits in the two months before and after childbirth. After the complaint was filed, the Connecticut legislature repealed the statute, effective October 1, 1973, but enacted no provision for redress to women from whom benefits had been withheld by reason of the statute prior to that date.
Soon after the institution of the action, the Court held a series of conferences with counsel and ranking State officials. As a result, the parties settled all the issues in the case, except the question of an award of attorneys' fees to plaintiff's counsel; and incident thereto, a consent order was issued on June 26, 1973.1
With respect to legal fees, this Court, over the defendant's objection, ruled that ten per cent of the benefits paid to plaintiff's class represented an appropriate fee. The defendant was ordered to deduct this amount from each claimant's award, and to forward the sums to plaintiff's counsel on a monthly basis. Subsequently the defendant requested a reconsideration of the decision, claiming for the first time that the deductions violated federal and state law. When the Department of Labor declined the Court's invitation to offer guidance on the federal question posed by the defendant, the Court refused to vacate its ruling but did modify the order to require that the funds be placed in escrow, pending the defendant's appeal to the Court of Appeals for the Second Circuit.
On appeal, by request of the Second Circuit, the Department of Labor submitted "definitive views" on the issue of attorneys' fees which "strongly support appellant's position" that Jordan v. Fusari, 496 F.2d 646, 649 (2 Cir. 1974).
In light of the government's position on appeal, the Court of Appeals decided that the best course to follow would be to remand the case for reconsideration for the following reasons:
Judge Zampano will then have an opportunity to weigh the thoroughly briefed views of the United States, which he was unable to obtain sooner, and appellees' response thereto. The record can also be clarified on the question of what the ten per cent fee amounts to, now that determinations of claims have presumably all been made. The district court should further consider the alternative theories appellees now advance, which may well justify a judgment imposing reasonable attorneys' fees on defendant, without deduction from the awards to plaintiffs' class. 496 F.2d at 650-51.
On remand, the Department of Labor's motion to intervene was granted; the parties submitted extensive briefs; and oral arguments were heard on the issue of attorneys' fees. Plaintiff's counsel now advance several alternative theories to sustain their request for an award in excess of $80,000; the defendant argues: 1) an award is not sustainable on any theory and is barred by the Eleventh Amendment;2 2) the claims for fees are inflated and excessive; and 3) if any fees are to be granted the claimants-beneficiaries as a class should pay the award; the intervenor contends that withholding of unemployment compensation benefits for attorneys' fees contravenes federal and state laws.
At the present time there is approximately $15,000 in escrow, representing ten per cent of the benefits awarded by the defendant to plaintiff's class to date, which is available to pay attorneys' fees. However, the government persuasively argues that it would be inconsistent with federal and state law if this Court directs any portion of unemployment compensation benefits to be paid to plaintiff's counsel. See, e. g., 26 U.S.C. § 3304(a); 42 U.S.C. § 503(a); Conn.Gen.Stat. § 31-272. Since neither the plaintiff nor the defendant has presented a sound argument to challenge the government's position, no useful purpose is served by reviewing the lengthy statutory and case citations submitted by the government. The Court is satisfied that unemployment benefits must be paid to the claimants promptly and in the full amount; therefore, any sums withheld for the payment of attorneys' fees would be contrary to law. Cf. California Human Resources Development v. Java, 402 U.S. 121, 131-33, 91 S.Ct. 1347, 28 L.Ed.2d 666 (1971). Accordingly, the Court will proceed to consider other theories to justify the payment of counsel fees in this case which do not involve deductions from benefits and would "avoid the thorny problems created by the order under attack," as recommended by the Court of Appeals. Jordan v. Fusari, supra at 650.
Although plaintiff's counsel on remand strenuously advance the so-called "private attorney general" theory to justify an award of fees, see, e. g., Kirkland v. New York State Dept. of Correctional Serv., 374 F.Supp. 1361, 1380-82 (S.D.N.Y.1974), that theory was laid to rest by the Supreme Court in the recent case Alyeska Pipeline Service Co. v. Wilderness Society, 421 U.S. 240, 95 S.Ct. 1612, 44 L.Ed.2d 141 (1975).
The plaintiff's attorneys also contend that an award of fees may be made on the ground that the litigation and these proceedings were compelled by the defendant's "unreasonable, obdurate obstinacy," the test referred to in Stolberg v. Members of Bd. of Tr. for State Col. of Conn., 474 F.2d 485, 489-91 (2 Cir. 1973). The Court disagrees. Costly and protracted litigation was avoided when this case was settled prior to trial; obviously, an agreement to dispose of the main issues by the issuance of a consent order was not possible without the cooperation and good faith efforts of the defendant. The defendant's resistance to the payment of counsel fees certainly cannot be characterized as the kind of "obdurate" conduct which would justify the imposition of attorneys' fees as a penalty. Under the circumstances of this case, the defendant's opposition to the plaintiff's motion for an award of counsel fees was reasonable.
While it is the general rule that "the prevailing litigant is ordinarily not entitled to collect a reasonable attorneys' fee from the loser," Alyeska Pipeline Service Co. v. Wilderness Society, supra, 421 U.S. at 247, 95 S.Ct. at 1616, a well-settled exception to the rule exists in special cases where the plaintiff's suit confers a benefit on a class of persons and the award of fees serves to spread the costs of litigation among the people within the benefitted class. Id. at 4567, 95 S.Ct. 1612; see also Hall v. Cole, 412 U.S. 1, 93 S.Ct. 1943, 36 L.Ed.2d 702 (1973); Mills v. Electric Auto-Lite Co., 396 U.S. 375, 90 S.Ct. 616, 24 L.Ed.2d 593 (1970); Sprague v. Ticonic Bank, 307 U.S. 161, 59 S.Ct. 777, 83 L.Ed. 1184 (1939).
As this Court has stated on prior occasions during the course of this lawsuit, the award of attorneys' fees would be an equitable and just application of judicial discretion. The plaintiff's action sought to secure the rights and guarantees of due process and equal protection to a large group of women in the State of Connecticut. By enjoining enforcement of the Connecticut statute, plaintiff compelled officials of the State to harmonize their actions with the congressional policy that unemployment compensation benefits should not be denied or diminished by reason of sex. In addition, substantial benefits have been conferred upon numerous members of an ascertainable class, cf. Mills v. Electric Auto-Lite Co., supra, 396 U.S. at 393-94, 90 S.Ct. 616, and a fund has been recovered in which others share. Cf. Sprague v. Ticonic Bank, supra, 307 U.S. at 166, 59 S.Ct. 777. See also Lindy Brothers Builders, Inc. v. American Radiator and Standard Sanitary Corporation, 487 F.2d 161, 164-166 (3 Cir. 1973).
Ordinarily, under these circumstances, the Court would deduct a fair award of attorneys' fees from the sums received by the benefited class. However, for the reasons stated previously, money to compensate plaintiff's counsel may not be derived from the pockets of the claimants-beneficiaries. But this is not dispositive of the issue. In certain unique situations, courts have applied a type of "common benefit" theory to support the award of counsel fees. For example, when pecuniary benefits have been conferred upon a class, but the payment of fees by that class is inappropriate, a defendant may be held liable for fees under a common benefit approach. See, e. g., Brewer v. School Board of City of Norfolk, 456 F.2d 943, 951-52 (4 Cir. 1972), cert. denied, 406 U.S. 933, 92 S.Ct. 1778, 32 L.Ed.2d 136 (1972); Holodnak v. Avco Corp., 381 F.Supp. 191, 206 (D.Conn.1974), rev'd in part on other grounds, 514 F.2d 285 (2 Cir. 1975).
In Brewer v. School Board of City of Norfolk, supra, a desegregation case, the Fourth Circuit ordered a school district to provide free busing for students assigned to schools beyond walking distance from their homes. The court decided to award attorneys' fees upon "a quasi-application of the `common fund' doctrine." 456 F.2d at 951. While the court recognized that the students received a pecuniary benefit in free bus transportation, it declared that to charge them a reasonable share...
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...three cases which they claim support their position. The first case is Jordan v. Fusari, 496 F.2d 646 (2d Cir. 1974), on remand, 422 F.Supp. 1179 (D.Conn.1975). This was a case where successful plaintiffs attempted to have attorney's fees deducted from benefits. This was not allowed. The se......
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