Library of Congress v. Shaw

• Citation: 106 S.Ct. 2957,478 U.S. 310,92 L.Ed.2d 250
• Decision Date: 01 July 1986
• Docket Number: No. 85-54,85-54
• Parties: LIBRARY OF CONGRESS, et al., Petitioners v. Tommy SHAW
• Court: United States Supreme Court

478 U.S. 310

106 S.Ct. 2957

92 L.Ed.2d 250

LIBRARY OF CONGRESS, et al., Petitioners

v Tommy SHAW.

No. 85-54.

Argued Feb. 24, 1986.

Decided July 1, 1986.

Syllabus

After petitioner Library of Congress had rejected respondent black employee's complaints alleging job-related racial discrimination, respondent's counsel pursued administrative relief and settlement negotiations, and eventually reached a settlement with the Library. The latter agreed to promote respondent retroactively with backpay if the Comptroller General determined that the Library was authorized to do so in the absence of a specific finding of racial discrimination. The Comptroller General ruled that the Library, under the Back Pay Act, lacked such authority. Respondent then filed suit in Federal District Court, alleging that Title VII of the Civil Rights Act of 1964 authorized the relief. The court agreed, and therefore authorized the Library to promote respondent with backpay, and to pay a reasonable attorney's fee and costs pursuant to § 706(k) of the Act, which provides that in any Title VII action the court may allow the prevailing party a "reasonable attorney's fee as part of the costs" and that "the United States shall be liable for costs the same as a private person." In calculating the attorney's fee, the District Court increased the lodestar amount by 30 percent to compensate counsel for the delay in receiving payment for his services. The Court of Appeals affirmed, holding that although the no-interest rule—under which no recovery can be had against the Government for interest in the absence of an express waiver of sovereign immunity from an award of interest—applied since compensation for delay is functionally equivalent to interest, Congress waived the Government's immunity from interest by making it liable "the same as a private person."

Held: The no-interest rule applies here so as to preclude the award of increased compensation to respondent's counsel for the delay in receiving payment for his services. Pp. 314-323.

(a) Section 706(k)'s provision making the United States liable "the same as a private person" waives the Government's immunity from attorney's fees, but not interest. The statute, as well as its history, contains no reference to interest, and thus precludes reading it as the requisite waiver of the Government's immunity from interest. Pp. 318-320.

(b) Nor is that requisite waiver found in § 706(k)'s requirement of awarding "reasonable" attorney's fees. There is no basis for reading the term "reasonable" as the embodiment of a specific congressional choice to include interest as a component of attorney's fees. And any congressional policy permitting recovery of a reasonable attorney's fee, no matter how compelling, is insufficient, standing alone, to waive the Government's immunity from interest. Pp. 320-321.

(c) Section 706(k)'s provision making the United States liable for "costs," including a reasonable attorney's fee, does not provide the clear affirmative intent of Congress to waive the Government's immunity from interest. Prejudgment interest is considered as damages, not a component of "costs." P. 321.

(d) The no-interest rule cannot be avoided by characterizing what is functionally equivalent to interest as compensation for delay. Both interest and a delay factor are designed to compensate for the belated receipt of money. Pp. 321-323.

241 U.S.App.D.C. 355, 747 F.2d 1469, reversed and remanded.

BLACKMUN, J., delivered the opinion of the Court, in which BURGER, C.J., and WHITE, POWELL, REHNQUIST, and O'CONNOR, JJ., joined. BRENNAN, J., filed a dissenting opinion, in which MARSHALL and STEVENS, JJ., joined, post, p. 323.

Charles A. Rothfeld, Washington, D.C., for petitioners.

Charles Stephen Ralston, New York City, for respondent.

Justice BLACKMUN delivered the opinion of the Court.

The no-interest rule is to the effect that interest cannot be recovered in a suit against the Government in the absence of an express waiver of sovereign immunity from an award of interest. In this case, attorney's fees as well as interest on those fees were awarded to a plaintiff who prevailed against petitioner Library of Congress in a suit brought under Title VII of the Civil Rights Act of 1964, 78 Stat. 253, as amended, 42 U.S.C. § 2000e et seq. We therefore must decide whether Congress, in enacting Title VII, expressly waived the Government's immunity from interest.

I

Respondent Tommy Shaw is an employee of the Library of Congress. He is black. During 1976 and 1977, he filed three complaints with the Library's Equal Employment Office alleging job-related racial discrimination. Following an investigation, Library officials rejected his complaints. Thereafter, respondent's counsel pursued administrative relief and settlement negotiations, and eventually reached a settlement with the Library. The latter agreed to promote Shaw retroactively with backpay provided that the Comptroller General first determined that the Library had authority to do so in the absence of a specific finding of racial discrimination. The Comptroller General ruled that the Library, under the Back Pay Act, 5 U.S.C. §§ 5595, 5596, lacked that power; he did not address whether such relief was authorized under Title VII.

Respondent then filed suit in the United States District Court for the District of Columbia, contending that Title VII authorized the Library to accord the relief specified in the settlement agreement. On cross-motions for summary judgment, the court agreed with respondent that the Library had the power under Title VII to settle his claim by awarding him a retroactive promotion with backpay without a formal finding of discrimination. 479 F.Supp. 945 (1979). The Library therefore was authorized to promote Shaw with backpay, and to pay a reasonable attorney's fee and costs pursuant to § 706(k) of the Civil Rights Act, 42 U.S.C. § 2000e-5(k). 479 F.Supp., at 949-950.

In a separate opinion calculating the attorney's fee, the District Court began with a lodestar of $8,435,¹ based on 99 hours of work at $85 per hour. App. to Pet. for Cert. 57a, 62a-66a. The court then reduced the lodestar by 20 percent to reflect the quality of counsel's representation. Id., at 66a-67a. Finally, and significantly for present purposes, the court increased the adjusted lodestar by 30 percent to compensate counsel for the delay in receiving payment for the legal services rendered. Id., at 68a. The District Court, relying on Copeland v. Marshall, 205 U.S.App.D.C. 390, 403, 641 F.2d 880, 893 (1980) (en banc), indicated that increasing an attorney's fee award for delay is appropriate because the hourly rates used for the lodestar represent the prevailing rate for clients who typically pay their legal bills promptly, whereas court-awarded fees are normally received long after the legal services are rendered. An increase for delay is designed to compensate the attorney for the money he could have earned had he been paid earlier and invested the funds. The District Court concluded that the period of delay ran from the time the case should have ended, which it viewed as the latter part of 1978, until just after judgment.

The Court of Appeals for the District of Columbia Circuit affirmed. 241 U.S.App.D.C. 355, 747 F.2d 1469 (1984). The court determined that, even though the adjustment was termed compensation for delay rather than interest, the no-interest rule applied because the two adjustments were functionally equivalent. The court went on to examine whether the Government expressly had waived its immunity from interest in Title VII. Section 706(k) of Title VII, 42 U.S.C. § 2000e-5(k), provides in relevant part:

"In any action or proceeding under this subchapter the court, in its discretion, may allow the prevailing party, other than the [EEOC] or the United States, a reasonable attorney's fee as part of the costs, and the [EEOC] and the United States shall be liable for costs the same as a private person." (Emphasis added.)

The Court of Appeals noted that in a Title VII suit against a private employer, interest on attorney's fees may be recovered. 241 U.S.App.D.C., at 361, 747 F.2d, at 1475. See, e.g., Chrapliwy v. Uniroyal, Inc., 670 F.2d 760 (CA7 1982), cert. denied, 461 U.S. 956, 103 S.Ct. 2428, 77 L.Ed.2d 1315 (1983). Therefore, the Court of Appeals reasoned, in making the United States liable "the same as a private person," Congress waived the United States' immunity from interest. In the alternative, the Court of Appeals held that even if the "same as a private person" provision was not an express waiver, the District Court's adjustment was proper; when a statute measures the liability of the United States by that of a private person, the "traditional rigor of the sovereign-immunity doctrine" is relaxed. 241 U.S.App.D.C., at 365, 747 F.2d, at 1479.

Judge Ginsburg dissented. Id., at 371, 741 F.2d, at 1485. She found no express waiver of immunity from interest, and declined to join what she considered to be a judicial termination of the no-interest rule. She viewed the increase for delay in this case as an award of interest, based on the manner and timing of its computation. She indicated, however, that use of current rather than historical hourly rates in order to compensate for delay, or use of historical rates that were based on expected delay, see Murray v. Weinberger, 239 U.S.App.D.C. 264, 741 F.2d 1423 (1984), would not run afoul of the no-interest rule.

We granted certiorari to address the question whether the Court of Appeals' decision conflicts with this Court's repeated holdings that interest may not be awarded against the Government in the absence of express statutory or contractual consent. 474 U.S. 815, 106 S.Ct. 403, 88 L.Ed.2d 354 (1985).

II

In the absence of express congressional consent to the award of interest separate from a general waiver of immunity to suit, the United States is immune from an interest award. This...