Superior Court Trial Lawyers Ass'n v. F.T.C.

• Decision Date: 26 August 1988
• Docket Number: No. 86-1465,86-1465
• Citation: 856 F.2d 226,272 U.S.App.D.C. 272
• Parties: , 57 USLW 2133, 1988-2 Trade Cases 68,196 ., Petitioners, v. FEDERAL TRADE COMMISSION, Respondent. United States Court of Appeals, District of Columbia Circuit
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 226

856 F.2d 226

272 U.S.App.D.C. 272, 57 USLW 2133,

1988-2 Trade Cases 68,196

SUPERIOR COURT TRIAL LAWYERS ASSOCIATION, et al., Petitioners, v. FEDERAL TRADE COMMISSION, Respondent.

No. 86-1465.

United States Court of Appeals District of Columbia Circuit.

Argued Sept. 10, 1987.

Decided Aug. 26, 1988.

Donald I. Baker, of the bar of the District of Columbia Court of Appeals, pro hac vice, by special leave of Court, with whom Willard K. Tom, Douglas E. Rosenthal, Willis B. Snell, Michael L. Denger, David T. Shelledy and W. Todd Miller were on the brief, for petitioners.

Ernest I. Isenstadt, Asst. Gen. Counsel, F.T.C., with whom Karen G. Bokat, Atty., F.T.C., was on the brief, for respondent.

Gerald P. Norton, Jo Ann Abramson, Arthur B. Spitzer and Elizabeth Symonds were on the brief for The American Civil Liberties Union Fund of the National Capital Area, Amicus Curiae, urging reversal.

Marc Gary and Patricia A. McCoy were on the brief for Washington Council of Lawyers, et al., Amici Curiae, urging reversal.

Before ROBINSON, SILBERMAN and D.H. GINSBURG, Circuit Judges.

Opinion for the Court filed by Circuit Judge D.H. GINSBURG.

Concurring opinion filed by Circuit Judge SILBERMAN.

D.H. GINSBURG, Circuit Judge:

We are called upon to review a determination by the Federal Trade Commission that petitioners, the Superior Court Trial Lawyers Association and four individual member attorneys, Ralph J. Perrotta, Karen E. Koskoff, Reginald G. Addison and Joanne D. Slaight, (hereinafter collectively SCTLA) violated Section 5 of the Federal Trade Commission Act, 15 U.S.C. Sec. 45 (1982), by organizing and participating in a concerted refusal to deal or "boycott" aimed at forcing the District of Columbia government to increase the hourly compensation paid to attorneys who represent indigent defendants in criminal cases before the District of Columbia Superior Court. The Commission concluded that the boycott constituted an "unfair method of competition" and entered an order requiring the petitioners to cease and desist from similar conduct in the future. ¹ For the reasons stated below, we grant the petition for review, in part, and remand to the Commission to determine whether SCTLA had the market power necessary for the boycott to violate Section 5.

I.

The District of Columbia Criminal Justice Act, D.C. Code Ann. Secs. 11-2601--11-2609 (1981 and 1987 Supp.) (CJA or Act) provides for the reimbursement of private lawyers who are appointed to represent indigent criminal defendants. ² Of all defendants who are unable to pay for counsel, 85% are represented by attorneys appointed under the CJA; another eight to ten percent are represented by the Public Defender Service (PDS), generally in more serious cases, and the rest are represented by third year law students (3-5%) and by pro bono private attorneys (under .5%). I.D.F. 19, 20.

Any member in good standing of the D.C. Bar, who has a local address and telephone number, may register with the CJA office of the PDS to receive appointments under the Act. Appointments are made by a Commissioner (or, on weekends, by a Superior Court judge) who compares a list of eligible defendants with a list of lawyers who have indicated their availability by telephoning the CJA office of the PDS between 7:45 a.m. and 8:15 a.m. that day. For the most part, names on the two lists are simply matched up in the order in which they appear until all the defendants have been provided counsel. The appointing official exercises some discretion, however, to assign a lawyer out of turn on the basis of the complexity of the case, the lawyer's known preferences, or the official's assessment of the lawyer's ability.

More than 1200 lawyers have registered for CJA appointments. In practice, however, most appointments go to a much smaller group of approximately 100 "CJA regulars," I.D.F. 18, who earn most or all of their income by representing indigent defendants. At least before the recent rate increase, the origins of which are at issue in this case, any lawyer who was interested in making a full time practice of CJA work could obtain a substantial caseload in a matter of weeks. ³ The CJA regulars accept CJA cases for a variety of reasons. Some of them have previous experience in public interest work and "consider representation of the poor [to be] the highest calling of the legal profession." I.D.F. 25. Some are motivated by an interest in criminal litigation. And some accept appointments under the CJA because there are no other legal jobs available to them. Id.

From 1970 until the boycott in 1983, fees for CJA cases were set at $30 per hour for time in court, and $20 per hour for other time, subject to a maximum of $1000 per case for felonies, $400 per case for misdemeanors, and $1000 per case for appeals. ⁴ The maximum compensation available to any individual for services provided under the Act was $42,000 per annum. ⁵ In order to get paid for CJA services, the attorney submits a voucher to the presiding judge showing the amount and nature of the time he or she spent on the case. The presiding judge has the authority to reduce the amount sought or, in particularly difficult or complex cases, to recommend to the Chief Judge compensation over the maximum per case limits. I.D.F. 27. Very few CJA regulars actually attained the annual maximum salary; one SCTLA member estimated that the average CJA lawyer made approximately $20,000 a year before the boycott. I.D.F. 29 & n. 102. In 1982, the District paid CJA lawyers a total of $4,579,572.

As early as 1975, the level of CJA fees became an issue of concern among some members of the bar. In that year, the Report on the Criminal Defense Services in the District of Columbia by the Joint Committee of the Judicial Conference of the D.C. Circuit and the D.C. Bar (Unified) at 77 (Austern-Rezneck Report), concluded that CJA attorneys were inadequately compensated. The Austern-Rezneck Report found that the prevailing rates drove talented lawyers out of CJA practice, and encouraged those who remained to do a less than adequate job on their cases. Id. at 78-79. The report therefore recommended that the CJA rates be increased to $40 an hour for time in or out of court, subject to a maximum $800 for a misdemeanor case and $1000 for a felony case. The report further expressed the belief that these rates "represent[ed] the absolute minimum necessary to attract and hold good criminal lawyers and assure their ability to render effective representation to their clients." Id. at 84.

Nonetheless, in 1982 the CJA rates remained unchanged from the level that had prevailed when the Austern-Rezneck report was released in 1975. In March 1982, the Report of the D.C. Court System Study Committee of the D.C. Bar, reprinted as Senate Print 98-34, 98th Cong., 1st Sess., Comm. on Govt'l Affairs (Horsky Report), recommended that all necessary steps be "taken by the Superior Court, the Mayor, and the D.C. Council to raise promptly the levels of compensation for attorneys appointed under the Criminal Justice Act to at least the levels proposed by the Austern-Rezneck Committee." Id. at 213. A bill increasing the hourly rate to $50 was then introduced in the D.C. Council, but it died in committee at the end of 1982 without a hearing. I.D.F. 36.

Meanwhile, in September 1982, petitioners Perrotta and Koskoff began a lobbying effort to increase the CJA compensation levels. Both petitioners, who were elected respectively President and Vice President of SCTLA in the fall of 1982, spent at least 90% of their time on CJA cases. I.D.F. 5-6. When they began their campaign, SCTLA was an informal association of CJA lawyers with no reliable membership list and no written by-laws. While the association kept a bank account, it did not enforce the rule that members pay $30 in annual dues. All CJA lawyers were allowed to participate in SCTLA meetings and to vote in SCTLA elections. I.D.F. 2-4.

Perrotta and Koskoff's early efforts included several conversations with Chief Judge Moultrie of the D.C. Superior Court, a meeting with Herbert Reid, Counsel to D.C. Mayor Marion Barry, and a strategy session with Wiley Branton, then Dean of Howard University Law School. Chief Judge Moultrie told Perrotta and Koskoff that he thought an increase in CJA compensation levels was deserved, but he declined to give any public support to pending legislation on the ground that, if such legislation were passed, his court might be called upon to determine its legality. Mr. Reid also expressed sympathy with their cause, but told them that the Mayor would not support the legislation without the urging of Chief Judge Moultrie. I.D.F. 37-39. Dean Branton advised that, since there was no organized and influential constituency to lobby for its passage, the prospects for an increase were poor unless the CJA lawyers did "something dramatic to attract attention in order to get any relief." I.D.F. 40.

In March 1983, D.C. Council Chairman Clarke introduced a new and less ambitious bill (No. 5-128), providing for a rate of $35 per hour for CJA work. This time the Judiciary Committee of the Council held a hearing at which numerous witnesses, including representatives of the SCTLA, various local bar groups, the PDS, the Executive Office of the D.C. Courts, and others testified in favor of the increase; no one testified against it except insofar as the Executive Branch of the D.C. Government raised concerns about funding it. Indeed, in June a member of the Council staff told Koskoff that there was no money available to fund the bill. This report was confirmed by the city's Budget Director, who claimed that the D.C. government supported the increase in principle. SCTLA's next effort, to interest the Congressional Appropriations Subcommittee on the District of Columbia in federal funding for a CJA increase, was rejected for want of an initiative either from the legislative or from the judicial branch of the D.C. government. ...