Cent. Pension Fund of the Int'l Union of Operating Eng'rs & Participating Emp'rs v. Ray Haluch Gravel Co.

• Decision Date: 11 March 2014
• Docket Number: Nos. 11–1944,11–1970.,s. 11–1944
• Citation: 745 F.3d 1
• Parties: CENTRAL PENSION FUND OF THE INTERNATIONAL UNION OF OPERATING ENGINEERS AND PARTICIPATING EMPLOYERS et al., Plaintiffs, Appellants/Cross–Appellees, v. RAY HALUCH GRAVEL CO. et al., Defendants, Appellees/Cross–Appellants.
• Court: U.S. Court of Appeals — First Circuit

745 F.3d 1

CENTRAL PENSION FUND OF THE INTERNATIONAL UNION OF OPERATING ENGINEERS AND PARTICIPATING EMPLOYERS et al., Plaintiffs, Appellants/Cross–Appellees,

v.RAY HALUCH GRAVEL CO. et al., Defendants, Appellees/Cross–Appellants.

Nos. 11–1944, 11–1970.

United States Court of Appeals, First Circuit.

March 11, 2014.

Kenneth L. Wagner, with whom Blitman & King LLP was on brief, for appellants/cross-appellees.

José A. Aguiar, with whom Doherty, Wallace, Pillsbury and Murphy, P.C. was on brief, for appellees/cross-appellants.

Before THOMPSON, SELYA and DYK,^* Circuit Judges.

SELYA, Circuit Judge.

Although parties to civil litigation typically bear the burden of paying their own counsel, see Alyeska Pipeline Serv. Co. v. Wilderness Soc'y, 421 U.S. 240, 247, 95 S.Ct. 1612, 44 L.Ed.2d 141 (1975), statutes and contractual provisions sometimes alter that burden. When fee-shifting is in order, the trial judge, having superintended the litigation, has a superior coign of vantage—and he is expected to put his “acquired savvy ... to good use” in determining the amount of the award. United States v. Metro. Dist. Comm'n, 847 F.2d 12, 15 (1st Cir.1988).

In this case, the plaintiffs, after a bench trial, obtained a money judgment. Later, the judge made a fee award that pleased nobody. Both sides have appealed, challenging the amount of the award. After careful consideration, we conclude that the award fell within the spacious encincture of the judge's discretion. Accordingly, we affirm.

We sketch the relevant background and travel of the case. In 2009, the Central Pension Fund of the International Union of Operating Engineers and Participating Employers, together with various affiliates (collectively, the Fund), sued Ray Haluch Inc. (Haluch) ¹ to recover unpaid employee-related remittances allegedly due under a collective bargaining agreement (the CBA). The Fund's complaint included a prayer for attorneys' fees and costs pursuant to both the CBA and the Employee Retirement Income Security Act (ERISA), 29 U.S.C. §§ 1001– 1461.

A bench trial ensued and, on June 17, 2011, the district judge awarded the Fund damages in the amount of $26,897.41. See Int'l Union of Oper'g Eng'rs, Local 98 Health & Welfare, Pension & Annuity Funds v. Ray Haluch Gravel Co. (Haluch I), 792 F.Supp.2d 129, 138 (D.Mass.2011). The judge rejected the Fund's other claims for damages, including a claim for $156,988.54 allegedly owed on behalf of “John Doe” employees.²See id. at 137–38. In a separate and subsequent ruling, the judge awarded the Fund $18,000 in attorneys' fees, together with expenses of $16,688.15. See Int'l Union of Oper'g Eng'rs, Local 98 Health & Welfare, Pension & Annuity Funds v. Ray Haluch Gravel Co. (Haluch II), 792 F.Supp.2d 139, 143 (D.Mass.2011). The award represented a steep reduction from the sum sought in the Fund's fee request. See id.

The Fund appealed both the merits ruling and the fee award. Haluch cross-appealed, asserting that the fee award was overly generous. We entertained both appeals; held that the district court had committed reversible error with respect to its formulation of damages, see Cent. Pension Fund of the Int'l Union of Oper'g Eng'rs & Part'g Emp'rs v. Ray Haluch Gravel Co. (Haluch III), 695 F.3d 1, 7–11 (1st Cir.2012), and therefore deferred any consideration of the claims of error directed at the decision in Haluch II, see id. at 11 & n. 7.

On certiorari, the Supreme Court reversed, holding that we lacked jurisdiction to review the Haluch I damage judgment because the Fund's notice of appeal was untimely as to that judgment. See Ray Haluch Gravel Co. v. Cent. Pension Fund of the Int'l Union of Oper'g Eng'rs & Part'g Emp'rs (Haluch IV), ––– U.S. ––––, 134 S.Ct. 773, 783, 187 L.Ed.2d 669 (2014); see alsoFed. R.App. P. 4(a)(1)(A). In the wake of the Supreme Court's remand order, we dismissed the Fund's appeal insofar as it sought to challenge the Haluch I damage judgment and reinstated the cross-appeals challenging the separate judgment for fees and costs. We now turn to the assignments of error memorialized in these cross-appeals.

We review the amount of an award of attorneys' fees for abuse of discretion. See Spooner v. EEN, Inc., 644 F.3d 62, 66 (1st Cir.2011). This standard is highly deferential, and “we will set aside a fee award only if it clearly appears that the trial court ignored a factor deserving significant weight, relied upon an improper factor, or evaluated all the proper factors (and no improper ones), but made a serious mistake in weighing them.” Gay Officers Action League v. Puerto Rico (GOAL), 247 F.3d 288, 292–93 (1st Cir.2001). Within this rubric, a material error of law is always an abuse of discretion. See id. at 292.

Here, the Fund's putative entitlement to attorneys' fees rests on two independent grounds: the CBA's language, see Haluch III, 695 F.3d at 6–7, and ERISA's fee-shifting provision, see29 U.S.C. § 1132(g)(2)(D). Neither party has argued that the Fund's right to attorneys' fees under the CBA differs in any material respect from its corresponding right under ERISA. We therefore see no need to distinguish between these two sources of rights and, for ease in exposition, discuss the pending appeals in terms of ERISA.

ERISA provides in pertinent part that a district court shall award “reasonable attorney's fees and costs” to an employee benefit plan when the plan succeeds in securing a judgment for a violation of 29 U.S.C. § 1145 (as the Fund did here). 29 U.S.C. § 1132(g)(2)(D). This provision mirrors provisions found in a compendium of other laws in which Congress has granted courts the authority to award reasonable attorneys' fees and costs to prevailing parties. See, e.g.,29 U.S.C. § 216(b); 33 U.S.C. § 1365(d); 42 U.S.C. §§ 1988(b), 7604(d). When analyzing such agnate provisions, “we apply the vast body of jurisprudence which has sprung up in the crowded vineyard where Congress has planted a proliferous array of fee-shifting statutes.” Metro. Dist. Comm'n, 847 F.2d at 15;accord Indep. Fed'n of Flight Attendants v. Zipes, 491 U.S. 754, 758 n. 2, 109 S.Ct. 2732, 105 L.Ed.2d 639 (1989).

The calculation of shifted attorneys' fees generally requires courts to follow the familiar lodestar approach. See Perdue v. Kenny A. ex rel. Winn, 559 U.S. 542, 551–52, 130 S.Ct. 1662, 176 L.Ed.2d 494 (2010). One hallmark of this approach is flexibility. See Metro. Dist. Comm'n, 847 F.2d at 15.

In fashioning the lodestar, the first step is to calculate the number of hours reasonably expended by the attorneys for the prevailing party, excluding those hours that are “excessive, redundant, or otherwise unnecessary.” Hensley v. Eckerhart, 461 U.S. 424, 434, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983). The second step entails a determination of a reasonable hourly rate or rates—a determination that is often benchmarked to the prevailing rates in the community for lawyers of like qualifications, experience, and competence. See GOAL, 247 F.3d at 295. The product of the hours reasonably worked times the reasonable hourly rate(s) comprises the lodestar.

The lodestar may be further adjusted based on other considerations. See Coutin v. Young & Rubicam P.R., Inc., 124 F.3d 331, 337 (1st Cir.1997). Prominent among these considerations is the degree of a prevailing party's success. See Hensley, 461 U.S. at 440, 103 S.Ct. 1933 (explaining that “the extent of a plaintiff's success is a crucial factor” to be considered in tailoring the final award).

In this case, the district court patiently pursued the path paved by previous precedents in fashioning an award of attorneys' fees. It identified reasonable rates for the legal and paralegal services provided. See Haluch II, 792 F.Supp.2d at 140–41. It then examined the claimed hours and, based on a finding that some hours were excessive and/or unnecessary, reduced them by one-third across the board. See id. at 141–42. These computations yielded a lodestar of $84,656.50. See id. at 142. So far, so good: the Fund mounts no challenge to these aspects of the district court's handiwork—at least no challenge that is sufficiently articulated to merit appellate attention. See United States v. Zannino, 895 F.2d 1, 17 (1st Cir.1990) (holding that “issues adverted to in a perfunctory manner ... are deemed waived”).

Building on this foundation, the district court adjusted the lodestar value to $18,000. Relatedly, it ordered expense reimbursement in the sum of $16,688.15. It based the steep reduction in the lodestar value largely on two considerations.

First, the judge observed that the damages recovered amounted to only $26,897.41 and that, of this amount, only $10,267.11 represented delinquent employer contributions. See Haluch II, 792 F.Supp.2d at 142. This sum, the court noted, was far less than the nearly $200,000 in damages that the Fund had aspired to recover. See id. Moreover, the Fund had not prevailed on the crucial claim that employer contributions were due for “John Doe” employees. See supra note 2 and accompanying text. Thus, the Fund's success was “limited in comparison to the scope of the litigation as a whole.” Haluch II, 792 F.Supp.2d at 142 (quoting Hensley, 461 U.S. at 436, 103 S.Ct. 1933). Second, the court remarked that the initial lodestar calculation dwarfed the damage award ($26,897.41). Id. at 142–43.

Against this historical backdrop, we start with the Fund's appeal. That appeal challenges what the Fund envisions as the paltriness of the fees. In seeking a more munificent award, it argues that the district court was too focused on proportionality. Its argument relies on case law rejecting a strict rule requiring proportionality between damage awards and fee awards. See, e.g., Orth v. Wis. State Emps. Union, Council 24, 546 F.3d 868, 875 (7th Cir.2008); UAW Local 259 Soc. Sec. Dep't v. Metro Auto Ctr., 501 F.3d 283, 292–95 (3d Cir.2007); Bldg. Serv. Local 47 Cleaning Contractors Pension Plan v. Grandview Raceway, 46 F.3d 1392, 1401 (6th Cir.19...