Moreno v. City of Sacramento

• Decision Date: 28 July 2008
• Docket Number: No. 06-15021.,06-15021.
• Parties: Mario R. MORENO, Plaintiff-Appellant, v. CITY OF SACRAMENTO; Max Fernandez; Joshua Pino; John Vanella, Defendants-Appellees, and Voluntary Dispute Resolution Neutral, Defendant.
• Court: U.S. Court of Appeals — Ninth Circuit

534 F.3d 1106

Mario R. MORENO, Plaintiff-Appellant, v. CITY OF SACRAMENTO; Max Fernandez; Joshua Pino; John Vanella, Defendants-Appellees, and Voluntary Dispute Resolution Neutral, Defendant.

No. 06-15021.

United States Court of Appeals, Ninth Circuit.

Argued & Submitted December 5, 2007.

Submission Deferred December 5, 2007.

Submitted July 28, 2008.

Filed July 28, 2008.

Andrea M. Miller, Nageley, Meredith & Miller, Inc., Sacramento, CA, for the appellant.

Thomas A. Cregger, Randolph Cregger & Chalfant LLP, Sacramento, CA, for the appellees.

Appeal from the United States District Court for the Eastern District of California; David F. Levi, District Judge, Presiding. D.C. No. CV-01-00725-DFL/DAD.

Before: ALEX KOZINSKI, Chief Judge, ROBERT E. COWEN^* and HAWKINS, Circuit Judges.

KOZINSKI, Chief Judge:

We consider various issues pertaining to the district court's award of attorneys' fees under 42 U.S.C. § 1988.

Facts

Moreno sued the City of Sacramento and several other defendants, alleging that they violated his civil rights by seizing and destroying his property without due process. After lengthy pre-trial proceedings and a previous appeal, a jury awarded Moreno $717,000 in compensatory and punitive damages. Moreno's principal trial counsel, Andrea Miller, sought an award of attorneys' fees under 42 U.S.C. § 1988. Miller requested $704,858.07 for herself and her staff, including compensation for 1,973.6 hours of her own time, at a rate of $300 per hour. This request excluded around 9 percent of the total hours actually spent on the case.

The district court reduced the hours further, concluding that around a quarter to a third of the time spent on research, appeal and trial preparation and half the time spent on investigation was unnecessary. The district court also reduced Miller's hourly rate to that of a paralegal for the time she spent summarizing depositions. Finally, the district court reduced Miller's hourly rate from $300 to $250 an hour. The resulting award was $428,053.00, around 40 percent lower than requested.

Analysis

Lawyers must eat, so they generally won't take cases without a reasonable prospect of getting paid. Congress thus recognized that private enforcement of civil rights legislation relies on the availability of fee awards: "If private citizens are to be able to assert their civil rights, and if those who violate the Nation['s] fundamental laws are not to proceed with impunity, then citizens must have the opportunity to recover what it costs them to vindicate these rights in court." S.Rep. No. 94-1011, at 2 (1976), as reprinted in 1976 U.S.C.C.A.N. 5908, 5910.¹ At the same time, fee awards are not negotiated at arm's length, so there is a risk of overcompensation. A district court thus awards only the fee that it deems reasonable. See Hensley v. Eckerhart, 461 U.S. 424, 433, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983). The client is free to make up any difference, but few do. As a practical matter, what the district court awards is what the lawyer gets.

In making the award, the district court must strike a balance between granting sufficient fees to attract qualified counsel to civil rights cases, City of Riverside v. Rivera, 477 U.S. 561, 579-80, 106 S.Ct. 2686, 91 L.Ed.2d 466 (1986), and avoiding a windfall to counsel, see Blum v. Stenson, 465 U.S. 886, 897, 104 S.Ct. 1541, 79 L.Ed.2d 891 (1984) (quoting S.Rep. No. 94-1011, at 6 (1976)). The way to do so is to compensate counsel at the prevailing rate in the community for similar work; no more, no less.

In this case, the district court used the lodestar method to calculate fees. Under this method, a district court must start by determining how many hours were reasonably expended on the litigation, and then multiply those hours by the prevailing local rate for an attorney of the skill required to perform the litigation. See Blum, 465 U.S. at 895, 104 S.Ct. 1541. The district court may then adjust upward or downward based on a variety of factors. Hensley, 461 U.S. at 434, 103 S.Ct. 1933. The number of hours to be compensated is calculated by considering whether, in light of the circumstances, the time could reasonably have been billed to a private client. Id. We review the district court's calculation of the reasonable hours and hourly rate for abuse of discretion. See Camacho v. Bridgeport Fin., Inc., 523 F.3d 973, 977-78 (9th Cir.2008).

When the district court makes its award, it must explain how it came up with the amount. The explanation need not be elaborate, but it must be comprehensible. As Hensley described it, the explanation must be "concise but clear." 461 U.S. at 437, 103 S.Ct. 1933 (emphasis added). Where the difference between the lawyer's request and the court's award is relatively small, a somewhat cursory explanation will suffice. But where the disparity is larger, a more specific articulation of the court's reasoning is expected. See Bogan v. City of Boston, 489 F.3d 417, 430 (1st Cir.2007). We review the legal principles underlying the fee award de novo. Ferland v. Conrad Credit Corp., 244 F.3d 1145, 1148 (9th Cir.2001).

1. Reduction for Duplicative Work: Plaintiff requested fees for 227.9 hours of research, and the district court awarded fees for 171 hours. The district court found the hours requested to be excessive, suggesting that some of the research was duplicative because counsel spent substantial time preparing motions and briefs dealing with similar issues.

The court may reduce the number of hours awarded because the lawyer performed unnecessarily duplicative work, but determining whether work is unnecessarily duplicative is no easy task. When a case goes on for many years, a lot of legal work product will grow stale; a competent lawyer won't rely entirely on last year's, or even last month's, research: Cases are decided; statutes are enacted; regulations are promulgated and amended. A lawyer also needs to get up to speed with the research previously performed. All this is duplication, of course, but it's necessary duplication; it is inherent in the process of litigating over time. Here, there was a previous appeal (of the district court's grant of summary judgment) which would have added to the delay and rendered much of the research stale. One certainly expects some degree of duplication as an inherent part of the process. There is no reason why the lawyer should perform this necessary work for free.

It must also be kept in mind that lawyers are not likely to spend unnecessary time on contingency fee cases in the hope of inflating their fees. The payoff is too uncertain, as to both the result and the amount of the fee. It would therefore be the highly atypical civil rights case where plaintiff's lawyer engages in churning. By and large, the court should defer to the winning lawyer's professional judgment as to how much time he was required to spend on the case; after all, he won, and might not have, had he been more of a slacker.

The district court has a greater familiarity with the case than we do, but even the district court cannot tell by a cursory examination which hours are unnecessarily duplicative. Nevertheless, the district court can impose a small reduction, no greater than 10 percent — a "haircut" — based on its exercise of discretion and without a more specific explanation. Here, however, the district court cut the number of hours by 25 percent, and gave no specific explanation as to which fees it thought were duplicative, or why. While we don't require the explanation to be elaborate, it must be clear, and this one isn't. Plaintiff's counsel had already cut her fees by 9 percent, so an additional 25 percent cut would amount to over one third. The court has discretion to make such an adjustment, but we cannot sustain a cut that substantial unless the district court articulates its reasoning with more specificity. We therefore conclude that the district court's explanation is insufficient to sustain a 25 percent cut based on duplication.

Plaintiff also requested fees for 266.6 hours of preparation for the first two trial dates, July 2002 and February 2005, without indicating how much time was spent preparing for each date. Plaintiff requested fees for 340.7 hours for the third trial date, May 2005. The district court awarded the full hours for the third trial date, but reduced the hours for the first two dates by half, to 133.3. As with the research hours, the cut here is substantial, amounting to 20 percent of the total fees billed for trial, in addition to the 9 percent already cut by plaintiff's counsel.

The district court did not explain the necessity or degree of the cut, other than to say that the amount of time plaintiff's counsel spent was "excessive." We also find it curious—and somewhat arbitrary—that the district court simply cut the costs of preparation for the first two trials by 50 percent. The first two trial dates were three years apart; the time spent preparing for the first trial would be of relatively little use by the time the case was actually presented to the jury, so it is difficult to understand how a cut of those fees would be justified, much less a cut of a full 50 percent. The second and third trial dates were only about three months apart, so it is possible there was some duplication. After all, duplication always happens when a task is started, stopped and then taken up again later. But necessary duplication—based on the vicissitudes of the litigation process—cannot be a legitimate basis for a fee reduction. It is only where the lawyer does unnecessarily duplicative work that the court may legitimately cut the hours.

Of course, the court might have some specific reason for believing that work is excessive or duplicative, but it must explain why. We cannot sustain a 50 percent cut, over and above the 9 percent cut plaintiff's counsel already imposed on herself, without a clear explanation that we can review. The opaque explanation provided here is an...