Finkelstein v. Bergna
| Decision Date | 02 October 1992 |
| Docket Number | No. C 83-5125 TEH-(SC),C 84-1391 TEH-(SC).,C 83-5125 TEH-(SC) |
| Citation | 804 F. Supp. 1235 |
| Court | U.S. District Court — Northern District of California |
| Parties | Julius L. FINKELSTEIN, Plaintiff, v. Louis P. BERGNA, et al., Defendants. |
Alan Exelrod, solo practitioner, and Sanford Rosen and Samuel Miller of Rosen, Bien & Asaro, San Francisco, Cal., for plaintiff.
Steven Woodside, County Counsel, Ann Miller Ravel, San Jose, Cal., Chief Asst. County Counsel, and Michael Marron and Martin Dodd of Marron, Reid & Sheehy, San Francisco, Cal., for defendant County of Santa Clara.
Craig Brown, San Jose, Cal., for defendant Louis Bergna.
Both Plaintiff Julius L. Finkelstein ("plaintiff") and Defendants Louis P. Bergna and the County of Santa Clara ("defendants") object to the findings and recommendations of Magistrate Judge Wayne D. Brazil filed on July 31, 1992 (the "Recommendations"). As Chief Judge Henderson has recused himself from consideration of these motions, the matter has been referred to this court.
This fee dispute is (apparently) the final episode in a lengthy litigation that began in 1983. The underlying suit alleged causes of action against both the defendants and three others who were subsequently dismissed. The original suit alleged a number of causes of action,1 many of which were subsequently dismissed in a lengthy series of motions and appeals.
A jury in August of 1991 awarded plaintiffs $1,175,000, finding against the County on the due process property rights claim, and against Bergna on the two due process claims and the punitive damage claim. A post-judgment settlement reduced that award to $1,050,000, and on September 23, 1991, the court ordered that plaintiff was to recover reasonable attorneys' fees and costs. The determination of those fees and costs was referred to Magistrate Judge Brazil, who on July 30, 1992 issued extensive findings of fact and recommendations that the court award plaintiff $578,011.35 in attorneys' fees and $22,665.46 in costs, for a total of $600,676.81. Both parties object to portions of that recommendation.
The plaintiff objects to Magistrate Brazil's recommendations in several regards. First, he objects to the recommended hourly rates for both Mr. Exelrod, who performed the vast majority of the work on plaintiff's behalf, and Ms. Dutton, who was an associate of Mr. Exelrod's early in the litigation. Second, he objects to the magistrate's recommendation that both costs and fees associated with one of two mock trials conducted by plaintiff's counsel be disallowed. Third, he objects to the recommended disallowal of certain miscellaneous costs.
The defendants, on the other hand, object to the magistrate's recommendation that fees be allowed for work done on theories of liability upon which the plaintiff did not ultimately prevail, arguing that the award should be reduced to reflect time spent on those theories.
Additionally, both sides address the question, not considered by the magistrate, of whether interest on the fees and costs should accrue as of the merits judgment date of September 23, 1991,2 or only as of the quantification of the amount of fees and costs awardable.
We address each issue in turn.
In his recommendations, Magistrate Brazil has set the hourly rate for Mr. Exelrod at $250. Mr. Exelrod had requested an hourly rate of $300, which he claimed to be a reasonable 1991 rate for the work he performed.3 In arriving at the $250 figure, the magistrate found Mr. Exelrod's work to have been of the highest caliber, and thus that he was entitled to compensation at the prevailing rate for similar services rendered by the top members of the field. The difficulty, as the magistrate recognized, lies in determining what the relevant "field" is for purposes of assessing the prevailing rate.
This determination is not as straightforward as it may seem. Where, as here, the relevant specialty (in this case, civil rights actions) consists entirely of cases governed by fee-shifting statutes, there is no "control group" market for non-contingent services. Thus the court, by necessity, must select an analogous field from which to draw comparable rates. The magistrate in this case, after exhaustive analysis, found that Exelrod's work should be compensated at "hourly rates that the best civil litigators can attract in our community when they are involved in truly complex cases." Recommendations at 12. We find this reasoning persuasive, and concur in the finding that a rate of $300 per hour (or even $330) is reasonable in the San Francisco market for senior partners of Mr. Exelrod's experience in complex litigation.
The analysis does not stop there, however. As the magistrate emphasized, Mr. Exelrod is (for the most part) a solo practitioner, and as such performed not only work that, in a large-firm environment, would be billed at premium rates, but also work that, in such a firm, would be handled by junior associates or non-lawyers at considerably lower rates. While a rate of $300 for a senior partner is reasonable, it is reasonable only in an environment where that senior partner participates only in higher-level tasks, and delegates more mundane tasks to lower-paid employees. In other words, the relevant inquiry is not "what would the senior partner bill if this case had been handled by a large firm?" but rather "what would a large firm with a $300 top rate bill, in the aggregate, for the work performed?" The answer to that question is properly found, as the magistrate held, by reference to the "blended" rate for all tasks charged by such firms.
Plaintiff's own exhibits, as summarized at page 15 of the Recommendations, reveal that firms with a top rate of $300 per hour bill, in the aggregate, closer to $200 per hour on complex litigation. As such, even the alleged gains in efficiency by having one attorney do all the work, coupled with the unbilled work allegedly done by the plaintiff himself, do not justify a rate in excess of $250 per hour for Mr. Exelrod's time. Plaintiff's claim that no large firm in fact was willing to take this particular case does not alter the calculus; the court must nonetheless approximate the market rate for the services.
Nor does United States v. City and County of San Francisco, 748 F.Supp. 1416 (N.D.Cal.1990) compel a different result. While in that case the court questioned the efficiency of the "pyramidal staffing pattern" of larger firms, the issue in that case was whether individual attorneys should be compensated at varying rates for differing work appropriate to their own abilities. Much of the "legwork" in that case was in fact done by uncompensated or significantly less compensated law students. By analogy, the question there was whether the senior partner should bill different rates for depositions, research, and trials (all properly done by that senior partner in the first place), not whether the associates (law students) should be paid at senior partner rates.
Accordingly, this court adopts the magistrate's recommendation that Mr. Exelrod be compensated at an hourly rate of $250.
Similarly, the court adopts the recommendation that Ms. Dutton's work be compensated at the rate of $110 per hour. Her work was performed during her first year of practice, and plaintiff does not dispute that the figure of $110 per hour is in line with current rates for such associates. The court concurs with the magistrate's opinion that this rate adequately compensates Ms. Dutton for any delay in payment.
Defendants challenge the magistrate's recommendation that Mr. Exelrod be compensated for work done on theories of liability upon which the plaintiff did not ultimately prevail. In this case, however, all of the legal theories put forward arose from the same nucleus of operative facts, and the result obtained cannot possibly be described as a partial or limited victory. Indeed, the judgment obtained exceeded by a factor of more than three the defendants' final settlement offer, made after determination of liability. The instant case, which Hensley v. Eckerhart, 461 U.S. 424, 435, 103 S.Ct. 1933, 1940, 76 L.Ed.2d 40 (1983).
The magistrate correctly found, in an extensive and well reasoned discussion (Recommendations at 21-39), that virtually all of the effort expended by Mr. Exelrod was part of a "seamless web" of interrelated claims, and that to disallow some portion as unrelated to the claim upon which he prevailed would impermissibly force plaintiffs to choose between abandoning all but their most promising claim (a choice nearly impossible except in hindsight) on the one hand, and undertaking representation for which they would likely be only partially compensated on the other. Rather than revisit that analysis here, the court adopts the magistrates reasoning and recommendation as its own. No reduction shall be made in fees based upon alternate theories of liability.4
Plaintiff, in preparation for trial, conducted two sets of mock trials and focus groups. The magistrate has recommended that the fees and costs associated with the first of those mock trials be disallowed as not reasonably incurred. Plaintiff challenges this finding.
Mr. Exelrod has stated that the first of these mock trials addressed liability questions, while the second was for assessment of damages issues. However, as the magistrate notes, at the time of the first mock trial the liability issue was all but decided,...
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