Maldonado v. Houstoun, Secretary of PA Dep't of Public Welfare

• Decision Date: 27 June 2001
• Docket Number: No. 97-1893,97-1893
• Parties: (3rd Cir. 2001) EDWIN MALDONADO; MARIA DELORES MALDONADO, individually and as next friends of Ana Maldonado, Pablo Maldonado, Edwin Maldonado, Rey Maldonado, Yesenia Maldonado, and Jose Maldonado, and on behalf of all others similarly situated; MARIA ORTIZ; MICHAEL ORTIZ, individually and as next friends of Julie Ortiz, Michael Ortiz, and Angelica Ortiz, and on behalf of all other similarly situated; KENSINGTON WELFARE RIGHTS UNION; PHILADELPHIA WELFARE RIGHTS ORGANIZATION, on behalf of themselves and their members; TRAVELER'S AID SOCIETY OF PHILADELPHIA, individually and on behalf of its clients v. FEATHER O. HOUSTOUN, Secretary of the PENNSYLVANIA DEPARTMENT OF PUBLIC WELFARE; DON JOSE STOVALL, Executive Director of the PHILADELPHIA BOARD OF ASSISTANCE, both in their official capacities, Appellants
• Court: U.S. Court of Appeals — Third Circuit

Page 181

256 F.3d 181 (3rd Cir. 2001)

EDWIN MALDONADO; MARIA DELORES MALDONADO, individually and as next friends of Ana Maldonado, Pablo Maldonado, Edwin Maldonado, Rey Maldonado, Yesenia Maldonado, and Jose Maldonado, and on behalf of all others similarly situated; MARIA ORTIZ; MICHAEL ORTIZ, individually and as next friends of Julie Ortiz, Michael Ortiz, and Angelica Ortiz, and on behalf of all other similarly situated; KENSINGTON WELFARE RIGHTS UNION; PHILADELPHIA WELFARE RIGHTS ORGANIZATION, on behalf of themselves and their members; TRAVELER'S AID SOCIETY OF PHILADELPHIA, individually and on behalf of its clients v. FEATHER O. HOUSTOUN, Secretary of the PENNSYLVANIA DEPARTMENT OF PUBLIC WELFARE; DON JOSE STOVALL, Executive Director of the PHILADELPHIA BOARD OF ASSISTANCE, both in their official capacities, Appellants

No. 97-1893

UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT

June 27, 2001,

STAPLETON, ROSENN, Circuit Judges, and RESTANI, Judge, United States Court of International Trade^*

OPINION SUR MOTION for ATTORNEYS' FEES and COSTS

ROSENN, Circuit Judge:

The determination of a reasonable attorney's fee for a prevailing party under a fee shifting statute generally is a disagreeable and tedious task, especially where the fee petition is vigorously contested and the petition is in behalf of numerous lawyers who worked on the appeal. The fee motion before us claims over 550 hours of attorney time expended exclusively for work on the appeal. We are required to analyze the motion and supporting data to ascertain whether the amount claimed is reasonable. The motion is especially troublesome because in this single issue appeal ten lawyers represented the plaintiffs and claim compensation for not only an aggregate of 550.13 hours of service on the appeal, but an additional claim of 25.68 hours for services expended on the fee petition. The total sum claimed is $ 100,996.40 in attorneys' fees and $ 648.74 in costs.

The plaintiffs, welfare recipients in Pennsylvania, brought a class action in 1997 in the United States District Court challenging the constitutionality of Pennsylvania's two-tier durational residency requirement limiting the amount of public assistance benefits for new residents. The plaintiffs claimed that the two-tier welfare scheme violated their constitutional rights to travel, to equal protection, and to non-discriminatory treatment under the Privileges and Immunities Clause. They moved for class certification and an injunction. The plaintiffs sued pursuant to 42 U.S.C. 1983, naming the State Secretary of Public Welfare and the Executive Director of the Philadelphia Board of Assistance as defendants. The District Court held that the two-tier welfare scheme violated the Fourteenth Amendment Equal Protection Clause, granted the injunction, and certified the class action. On the basis of a stipulation of counsel, the District Court ordered the defendants to pay $ 248,000 for the plaintiffs' fees for services rendered in that court, and costs. The Commonwealth appealed and, after briefing and oral argument, we affirmed. See Maldonado v. Houstoun, 157 F.3d 179 (3d Cir. 1998).

After our decision, the Supreme Court of the United States granted certiorari to review Roe v. Anderson, 134 F.3d 1400 (9th Cir. 1998), a decision which struck down similar provisions in a California statute.

Based on our decision and the decision of the United States Supreme Court in Saenz v. Roe, 526 U.S. 489, 143 L. Ed. 2d 689, 119 S. Ct. 1518 (1999) (affirming the judgment of the United States Court of Appeals for the Ninth Circuit in Roe v. Anderson, 134 F.3d 1400 (9th Cir. 1998)), we now have before us the plaintiffs' motion for attorneys' fees and costs in connection with their appeal to this court.

I.

The plaintiffs (appellees) claim that they are entitled to the attorneys' fees and costs requested because they prevailed on the appeal within the meaning of 42 U.S.C. 1983. See 42 U.S.C. 1988(b) (providing, in the court's discretion, a reasonable attorney's fee to a prevailing party to a 1983 action). As we stated above, they also prevailed in the District Court where the trial judge, acting on a stipulation of counsel for the parties, entered an order on January 3, 2000, awarding plaintiffs $ 248,000 in full satisfaction of fees and costs incurred in that court. Regrettably, we have no stipulations in the motion before us; on the contrary, the appellants (effectively the State) strenuously oppose the motion in all of its aspects.

The State contends that the fees requested are "grossly unreasonable." It acknowledges that the appellees are entitled to receive a fee award, but asserts that the fee request is "grotesquely inflated." The State emphasizes that the appeal presented only a single issue which, although important, was not particularly complicated, and turned largely on the Court's construction of Shapiro v. Thompson, 394 U.S. 618, 22 L. Ed. 2d 600, 89 S. Ct. 1322 (1969). Specifically, the State argues that an award for the hours claimed for preparation of the brief at oral argument should be substantially reduced, and that the appeal's single issue, "which had already been thoroughly explored in the District Court," reasonably should have required no more than 100 hours. The State also contends that the hourly rate claimed for the attorneys is excessive and that the allowable hourly rate for all lawyers, including those of a private law firm, should conform to the rates of Community Legal Services (CLS), which have been widely accepted as fairly reflecting the prevailing market rates in Philadelphia. The State asserts that attorneys of Dechert, Price & Rhoads provided insufficient support for their high rates claimed.

On the other hand, the appellees assert that the issues on appeal "were complex and difficult," required familiarity with a large body of case law, state statutes and regulations, that the case was not "over-lawyered" by the plaintiffs, and that they have "already substantially reduced their hours to account for any inefficiencies created by a multi-firm team." They further assert that the time they spent on the appeal was reasonable, and that the State's lack of cooperation in the preparation of the appendix added to the expense. They also argue that the hourly rate claimed is reasonable and that the State should be ordered to pay Dechert "at its normal rates, which are set by the market."

II.

In assessing the reasonableness of a claimed fee in cases like this, we use the "lodestar" formula, which requires multiplying the number of hours reasonably expended by a reasonable hourly rate. See Hensley v. Eckerhart, 461 U.S. 424, 76 L. Ed. 2d 40, 103 S. Ct. 1933 (1983); Pennsylvania v. Delaware Valley Citizens' Council for Clean Air, 478 U.S. 546, 92 L. Ed. 2d 439, 106 S. Ct. 3088 (1986); Pennsylvania Environ. Def. Found. v. Canon-McMillan, 152 F.3d 228, 232. "When the applicant for a fee has carried his burden of showing that the claimed rates and number of hours are reasonable, the resulting product is presumed to be the reasonable fee to which counsel is entitled." Delaware Valley Citizens' Council, 478 U.S. at 564 (internal quotation omitted).

In calculating the hours reasonably expended, a court should "review the time charged, decide whether the hours set out were reasonably expended for each of the particular purposes described and then exclude those that are 'excessive, redundant, or otherwise unnecessary.' " Public Int. Research Group of N.J., Inc. v. Windall, 51 F.3d 1179, 1188 (3d Cir. 1995) (internal citation omitted); see also Rode v. Dellarciprete, 892 F.2d 1177, 1183 (3d Cir. 1990) ("The district court should exclude hours that are not reasonably expended."). "Hours that would not generally be billed to one's own client are not properly billed to an adversary." Public Interest Group, 51 F.3d at 1188. Thus, we have a positive and affirmative function in the fee fixing process, not merely a passive role.

Generally, a reasonable hourly rate is calculated according to the prevailing market rates in the relevant community. See Blum v. Stenson, 465 U.S. 886, 895, 79 L. Ed. 2d 891, 104 S. Ct. 1541 (1984); Dellarciprete, 892 F.2d at 1183. The court "should assess the experience and skill of the prevailing party's attorneys and compare their rates to the rates prevailing in the community for similar services by lawyers of reasonably comparable skill, experience, and reputation." Dellarciprete, 892 F.2d at 1183. The prevailing party "bears the burden of establishing by way of satisfactory evidence, 'in addition to [the] attorney's own affidavits,' . . . that the requested hourly rates meet this standard." Washington v. Philadelphia Cty. Ct. of Common Pleas, 89 F.3d 1031, 1035 (3d Cir. 1996) (citing Blum v. Stenson, 465 U.S. 886, 895 n.11, 79 L. Ed. 2d 891, 104 S. Ct. 1541 (1984)). The starting point in ascertaining a reasonable hourly rate "is the attorney's usual billing rate, but this is not dispositive." Public Interest Group, 51 F.3d at 1185.

In analyzing this heated controversy, some concepts and precepts are indisputable. The plaintiffs presented an excellent case and a high quality brief. Accordingly, they are entitled to all hours "reasonably expended on the litigation." West Virginia University Hospitals, Inc. v. Casey, 898 F.2d 357, 360 (3d Cir. 1990) (quoting Hershey v. Echerhart, 461 U.S. 424, 436, 103 S. Ct. 1933, 76 L. Ed. 2d 40 (1993). The converse is also true; they are not entitled to compensation for hours unreasonably expended on the litigation.

III.

We do not question the accuracy of counsel's records. Our principal concern is whether the time claimed is reasonable for the services performed, a concern which is accentuated because of the many lawyers involved in behalf of the plaintiffs. Ordinarily, this appeal could have been briefed and argued by a single lawyer or two. Lawyers should understand that although the likelihood of success in a...