Huntington Branch, N.A.A.C.P. v. Town of Huntington, N.Y.

Decision Date13 April 1992
Docket NumberNo. 298,D,298
Citation961 F.2d 1048
PartiesHUNTINGTON BRANCH, NATIONAL ASSOCIATION FOR the ADVANCEMENT OF COLORED PEOPLE; Housing Help, Inc.; Mabel Harris; Perrepper Crutchfield; Kenneth L. Cofield, Plaintiffs-Appellees, v. TOWN OF HUNTINGTON, NEW YORK; United States Department of Housing and Urban Development; Samuel R. Pierce; Kenneth C. Butterfield; Claire Kroft; Kenneth Deegan; Edward Thompson; Joseph Clemente, Defendants, Town of Huntington, New York; Kenneth C. Butterfield; Claire Kroft; Kenneth Deegan; Edward Thompson; Joseph Clemente, Defendants-Appellants. ocket 91-6124.
CourtU.S. Court of Appeals — Second Circuit

Richard C. Cahn, Melville, N.Y. (Cahn Wishod Wishod & Lamb, of counsel), for defendant-appellant Town of Huntington.

Leon Friedman, New York City (Richard Bellman, of counsel), for plaintiffs-appellees.

Before: OAKES, VAN GRAAFEILAND and NEWMAN, Circuit Judges.

VAN GRAAFEILAND, Circuit Judge:

This is an appeal from that portion of a judgment and order of the United States District Court for the Eastern District of New York (Glasser, J.), which increased an award of attorneys' fees in a civil rights action by $377,276.73, enhancing by 75 percent the lodestar figure of $503,035.65. In granting plaintiffs' application in this manner, the district court increased the allowance for plaintiffs' two principal attorneys from a lodestar hourly rate of $225 to an enhanced rate of $393, and made this retroactive to 1981, the year the attorneys were retained. The allowance for the attorneys' two associates and an NAACP attorney was increased from a lodestar rate of $135 per hour to approximately $170 per hour. The district court's MEMORANDUM AND ORDER is reported at 749 F.Supp. 62 (E.D.N.Y.1990), modified, 762 F.Supp. 528 (E.D.N.Y.1991), and familiarity with it is assumed.

The district court arrived at the lodestar figures by looking to the rates that prevailed in the pertinent field and community in 1990. Neither the record nor the district court's opinion discloses what plaintiffs' attorneys were charging in 1981 or in any of the intervening years during which their associates were employed. The Supreme Court has said that district courts may use currently prevailing rates to compensate for delay in payment of fees previously earned. See Missouri v. Jenkins, 491 U.S. 274, 282-84, 109 S.Ct. 2463, 2468-69, 105 L.Ed.2d 229 (1989). This does not mean, however, that district courts must do so. See Chambless v. Masters, Mates & Pilots Pension Plan, 885 F.2d 1053, 1060 (2d Cir.1989), cert. denied, 496 U.S. 905, 110 S.Ct. 2587, 110 L.Ed.2d 268 (1990). It would be unfair, for example, to use current rates where the services at issue were performed in protracted litigation and current inflated rates did not reflect with some degree of accuracy the loss attributable to delay. See New York State Ass'n for Retarded Children, Inc. v. Carey, 711 F.2d 1136, 1153 (2d Cir.1983). Because defendants have not pursued their challenge to the lodestar awards on appeal, the issue of historical rates and enhancement attributable to delay in payment need not concern us insofar as those awards are concerned. However, because defendants continue to contest the retroactive 75 percent enhancement of the lodestar figures, the issue of historical rates continues to be of significance.

After some uncertainties, the law now is well settled that the lodestar figure in a fee-shifting case is strongly presumed to be reasonable, Pennsylvania v. Delaware Valley Citizens' Council for Clean Air, 478 U.S. 546, 565, 106 S.Ct. 3088, 3098, 92 L.Ed.2d 439 (1986) ("Delaware Valley I "), and that "enhancement of an award may no longer be justified on the basis of factors such as the novelty of the issues, the complexity of the litigation, the high quality of the representation, or the number of people benefited," Krieger v. Gold Bond Bldg. Prods., 863 F.2d 1091, 1099 (2d Cir.1988) (citing Blum v. Stenson, 465 U.S. 886, 898-900, 104 S.Ct. 1541, 1548-1550, 79 L.Ed.2d 891 (1984)). Modifications of the lodestar figure are permissible, if at all, only in "certain 'rare' and 'exceptional' cases supported by both 'specific evidence' on the record and detailed findings by the lower courts." Delaware Valley I, supra, 478 U.S. at 565, 106 S.Ct. at 3098 (quoting Blum, supra, 465 U.S. at 899, 104 S.Ct. at 1549); see also Hensley v. Eckerhart, 461 U.S. 424, 437, 103 S.Ct. 1933, 1941, 76 L.Ed.2d 40 (1983).

The Supreme Court has rejected the argument that a prevailing party is entitled to a fee augmentation to compensate for the risk of nonpayment. Missouri v. Jenkins, supra, 491 U.S. at 282, 109 S.Ct. at 2468 (citing Pennsylvania v. Delaware Valley Citizens' Council for Clean Air, 483 U.S. 711, 107 S.Ct. 3078, 97 L.Ed.2d 585 (1987) ("Delaware Valley II ")). Prior to the Supreme Court's decision in Delaware Valley II, however, we had held that the element of risk is pertinent to the extent that it makes it difficult for a would-be plaintiff to secure competent counsel. In Lewis v. Coughlin, 801 F.2d 570, 576 (2d Cir.1986), we said that "an attorney's fee award should be only as large as necessary to attract competent counsel" and that "one relevant factor bearing on high-risk is whether other counsel had declined to take the case because there was little or no prospect of earning a fee." This holding was quoted with apparent approval by Justice White who wrote for four justices in Delaware Valley II, supra, 483 U.S. at 731 n. 12, 107 S.Ct. at 3089 n. 12. Justice O'Connor, who concurred in part in Delaware Valley II, restated the proposition in her own words:

I would also hold that a court may not enhance a fee award any more than necessary to bring the fee within the range that would attract competent counsel.

Id. at 733, 107 S.Ct. at 3090.

Other circuits also have recognized the relevance of evidence that unretained counsel had declined to take the case because of the risk of nonpayment. See Fadhl v. City and County of San Francisco, 859 F.2d 649, 651 (9th Cir.1988) (case rejected by 35 other lawyers); Clark v. City of Los Angeles, 803 F.2d 987, 991 (9th Cir.1986) (case rejected by at least 10 other lawyers); Wildman v. Lerner Stores Corp., 771 F.2d 605, 614 (1st Cir.1985) (district court directed to determine on remand whether other attorneys refused to take the case because of risk of nonpayment). The court below held, however, that it was irrelevant whether plaintiffs had approached lawyers other than those they retained and had been turned down because of the risk of not recovering.

Subsequent to Delaware Valley II, we have adhered to our prior holdings, see Dague v. City of Burlington, 935 F.2d 1343, 1360 (2d Cir.1991), cert. granted, --- U.S. ----, 112 S.Ct. 964, 117 L.Ed.2d 130 (1992); Friends of the Earth v. Eastman Kodak Co., 834 F.2d 295, 298 (2d Cir.1987), and we do so here. We do not decide whether proof of substantial difficulties in finding counsel can be established in other cases by lawyers' conclusory affidavits, such as were used in the instant case, although to some extent we share the misgivings of the en banc majority of the Court of Appeals for the District of Columbia as expressed in King v. Palmer, 950 F.2d 771, 779 (D.C.Cir.1991) ("We think it is indisputable that if such evidence were treated as determinative, or even weighty, the substantial difficulties test would be met so easily as to become a mere formality."). We hold that in the instant case the issue of substantial difficulties in finding representation requires some specific factual development, because one of the plaintiffs is the Huntington Branch, National Association for the Advancement of Colored People, "whose purpose in society is to eliminate racial discrimination in housing, employment, education and other areas...." Huntington Branch NAACP v. Town of Huntington, 530 F.Supp. 838, 839 (E.D.N.Y.1981), rev'd, 689 F.2d 391 (2d Cir.1982), cert. denied, 460 U.S. 1069, 103 S.Ct. 1523, 75 L.Ed.2d 947 (1983). As a general rule, fee enhancement is unnecessary "where plaintiffs secure help from organizations whose very purpose is to provide legal help through salaried counsel to those who themselves cannot afford to pay a lawyer." Delaware Valley II, sup...

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