Moore v. National Ass'n of Securities Dealers, Inc., 83-2213
| Decision Date | 19 June 1985 |
| Docket Number | No. 83-2213,83-2213 |
| Citation | 246 U.S.App.D.C. 114,762 F.2d 1093 |
| Parties | 37 Fair Empl.Prac.Cas. 1749, 37 Empl. Prac. Dec. P 35,316, 246 U.S.App.D.C. 114, 53 USLW 2629, 2 Fed.R.Serv.3d 157 Sharon A. MOORE, Appellant v. NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC. |
| Court | U.S. Court of Appeals — District of Columbia Circuit |
Paul March Smith, Washington, D.C., with whom Joseph N. Onek, Washington, D.C., was on the brief, for appellant.
Anthony W. Kraus, Baltimore, Md., with whom Richard T. Sampson, Baltimore, Md., and Andrew McR. Barnes, Washington, D.C., were on the brief, for appellee. Scott L. Sherman, Baltimore, Md., also entered an appearance for appellee.
Robert E. Williams and Douglas S. McDowell, Washington, D.C., were on the brief for amicus curiae, Equal Employment Advisory Council, urging affirmance.
Charles Stephen Ralston, New York City, was on the brief for amicus curiae, NAACP Legal Defense and Educ. Fund, Inc., urging reversal.
Before WRIGHT and WALD, Circuit Judges, and MacKINNON, Senior Circuit Judge.
Sharon Moore brought a Title VII class action suit that was settled prior to trial pursuant to a consent decree entered by the district court. In the settlement process Moore and her counsel waived all claims for attorneys' fees and costs otherwise available under section 706(k) of the Civil Rights Act of 1964, 42 U.S.C. Sec. 2000e-5(k). After Moore's agreement to the settlement as class representative but prior to a fairness hearing as to class members, Moore changed her position and requested that the court separately modify the settlement to include attorneys' fees and costs. The district court rejected Moore's proposal and affirmed the settlement. This case presents the narrow question of whether the fee-shifting provision of Title VII prohibits a plaintiff from voluntarily offering to waive attorneys' fees and costs during simultaneous negotiations of merits, fees, and costs. We hold that in this case simultaneous negotiations are permissible, and that a plaintiff may voluntarily waive attorneys' fees and costs if done so without a demand by the defendant. On the merits, because we believe that the district court did not abuse its discretion, we affirm.
Appellant Sharon A. Moore was a black employee of appellee National Association of Securities Dealers ("NASD") from November 1978 to February 1980. On December 1, 1980, she initiated this class action against NASD, alleging discrimination against blacks and females in recruitment, selection, training, evaluation, promotion, and work assignments in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. Sec. 2000e et seq., and the Equal Pay Act, 29 U.S.C. Sec. 206(d). Moore sought declaratory, injunctive, and monetary relief. The district court certified the class as to black employees but permitted Moore to pursue her sex discrimination claim on her own. After partial discovery, the class was further narrowed to include only those black employees employed by NASD as officers, managers, or professional market analysts since February 1979. The sex discrimination claims were later abandoned.
The parties engaged in discovery on the merits from mid-October, 1982 until mid-March, 1983. In the course of discovery, Moore inspected over four hundred personnel files of current and former black and white employees of NASD, thousands of pages of NASD salary administration and personnel documents, and applicant flow information relating to the interviewing, hiring, and promotion of NASD employees. Moore also deposed middle- and upper-level managers of NASD.
On April 4, 1983, Moore's counsel sent to NASD an offer of settlement. The proposal included prospective relief, made no provision for back pay, and left the question of attorneys' fees and costs to be decided after approval of the merits settlement (Joint Appendix (J.A.) 76-80). NASD rejected this offer. Moore's counsel then offered to accept the same merits relief and file a petition with the court with a cap of $100,000 on fees and expenses. NASD believed "that fees and expenses created a problem" (J.A. 81). (Moore's counsel estimated costs of about $30,000 and fees in excess of $200,000.) Id. NASD rejected this offer. Moore's counsel next offered to accept the affirmative relief plus expenses and $50,000 for fees. Again, NASD refused. Finally, Moore's attorney wrote to NASD's counsel:
Having considered the matter overnight and not wishing to deprive my clients of the relief you are willing to give by considering the question of fees and expenses, I offer to you the following proposal:
Your client grants the relief requested in our settlement letter of April 4, 1983 and we will take in full discharge of any claim for fees and expenses anything that your client is willing to give, and that would include nothing, if that is your position.
I consider the case closed.
(J.A. 81-82).
The parties prepared draft memoranda of understanding and discussed them with the court on May 23, 1983. Moore's counsel stated that Moore viewed the success of settlement as hinging on her waiving claims for fees. Moore felt that consistent with her responsibility as a representative of the class she could not "place her own economic interest before the interest of the class," and thus concurred in the settlement proposal. She did, however, maintain that the settlement was fair and urged the court to accept it (J.A. 73-74). NASD explained in court that it considered the waiver of fees and costs fair because it felt it could prove at trial that there was no Title VII violation; and, therefore, no costs or attorneys' fees would be compensable (J.A. 31).
On May 27, 1983, the district court held a hearing at which the parties moved jointly for preliminary approval of the settlement and for entry of a consent decree. The court voiced concern over the waiver of fees and costs:
THE COURT: All right.
Now my next question is one that I raised the last time, and I asked you as a predicate to it, do you think that the plaintiffs have secured [a] benefit for the class? And you said "Yes."
So then my next question is, if they have secured a benefit for the class, what about the question of attorneys' fees?
Well, Mr. Webster positioned himself the last time with respect to the claim for attorneys' fees. Well, that might be true and maybe he doesn't want attorneys' fees, but I still raise the question of costs.
I don't know what the costs are, but it seems to me--and I will tell you quite frankly I don't mind saying it--that if this has been of benefit to the class, and you admit it and the record shows that you admit it, it seems to me that they are entitled not only to attorneys' fees, but to costs.
Now the question of attorneys' fees I put in a different category than of costs, although they are really lumped together.
Mr. Webster and the public interest group that he is associated with may well waive and relinquish any right or any claim they may have as far as attorneys' fees are concerned, but it just seems to me unusually harsh and, I will say it inequitable, too, for them to leave here without getting their costs.
MR. SAMPSON: Your Honor, what I would say to that is that I have agreed that the consent decree is fair and reasonable. It recites programs which the NASD would assert that it would have undertaken in any event.
That can be open for reasonable debate as to whether it was stimulated by this lawsuit or stimulated by the management practices of the NASD.
....
Your Honor, there are things in the consent decree that the NASD has agreed to within the context of the plaintiff waiving costs and attorneys' fees. That was part and parcel of our considerations of things we may have disagreed with, but we agreed to do.
She knows she bears the responsibility for costs and that is stated in the documents.
THE COURT: All right.
(J.A. 104-06). This waiver effectively left Moore responsible for her attorneys' fees and costs already paid to previous counsel (roughly $3,100) and expenses incurred but not yet paid in connection with present counsel's representation (roughly $34,000). Moore, who was present in the courtroom during this exchange, was subsequently questioned by the court regarding the agreement:
(J.A. 113).
The court preliminarily approved the settlement decree on May 31, 1983, and ordered that class members be notified and a hearing held for their objections. But on July 1, Moore changed her position and, with other class members, filed a petition protesting the waiver of fees and costs (J.A. 127-30). 1 The basis of her complaint was that the waiver of fees and costs would discourage attorneys from pursuing Title VII claims. Moore requested that the court either award attorneys' fees and costs as it saw fit, or allow counsel to petition the court for those awards.
At a July 18 hearing, the district court learned that Moore's liability for costs extended to roughly $34,000. She had advanced some $3,100 in personal funds to previous counsel in the case and, as class representative, had held herself ultimately responsible for expenses. The court refused to let Moore leave...
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