Quesada v. Thomason

• Decision Date: 23 June 1988
• Docket Number: No. 87-5919,87-5919
• Citation: 850 F.2d 537
• Parties: Pedro QUESADA, Plaintiff-Appellant, and Hugh R. Manes, Real Party in Interest Appellant, v. Ronald THOMASON, Miles J. Sutton, Rubin A. Mendoza, Robert Nichols, Los Angeles County, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 537

850 F.2d 537

Pedro QUESADA, Plaintiff-Appellant and Hugh R. Manes, Real Party in Interest Appellant, v. Ronald THOMASON, Miles J. Sutton, Rubin A. Mendoza, Robert Nichols, Los Angeles County, Defendants-Appellees.

No. 87-5919.

United States Court of Appeals Ninth Circuit.

Argued and Submitted April 6, 1988.

Decided June 23, 1988.

Hugh R. Manes, Manes & Watson, Los Angeles, Cal., for plaintiff-appellant.

Philip S. Miller, Principal Deputy County Counsel, Los Angeles, Cal., for defendants-appellees.

Appeal from the United States District Court for the Central District of California.

Before BROWNING, Chief Judge, NELSON and CANBY, Circuit Judges.

NELSON, Circuit Judge:

Pedro Quesada sued four Los Angeles County sheriffs under section 1983 for a brutal beating he received at their hands. He originally sought $50,000 in damages, though he later decreased this request to $25,000. Prior to trial, the County settled the case, giving Quesada $17,500. Quesada had previously agreed to pay his attorney a percentage of any monetary recovery. Quesada filed a motion for statutory attorneys' fees under 42 U.S.C. Sec. 1988, and submitted the usual documentation, including time records indicating that his attorney spent 147.3 hours preparing for trial, and a statement that this attorney usually charged $150.00 per hour. The County opposed any award of attorneys' fees, and argued in the alternative that the case was worth no more than $100.00 per hour, and required at most 25-30 hours of preparation.

After an evidentiary hearing, the district judge awarded $7,500 in attorneys' fees. Plaintiff's requested billing would have generated $22,095. The county's calculation would have yielded an award of $3,000. The judge explained that although counsel's hours did exceed the amount of the award, and the reasonable value of counsel's services exceeded $50.00 per hour, the result was justified by the amount involved and the results obtained.

Quesada then moved for reconsideration, arguing that the award was insufficient, and that the district court had not considered the appropriate factors in reaching the result. The district judge refused to alter the award, explaining that he "considered all of the factors that are set forth in the Kerr case, and ... believe[d] there are a dozen of them, and ... [didn't] believe the case was a particularly novel case legally ... but ... was influenced by the amount involved and the results obtained." The court also noted "I'm sure that the reasonable value of your services exceeds $50.00 an hour, but under the circumstances of this case I do believe that the award of attorneys fees was reasonable and appropriate ... because of the amount involved and the fact that it was settled and the fact that you had a contingent-fee arrangement with your client and pursuant to that agreement you agreed to accept as attorneys' fees for your representation one-third of any recovery."

Quesada appeals this ruling on the grounds that the district court failed to consider all of the appropriate factors in setting a reasonable fee, and that the district court inappropriately considered his contingent-fee arrangement in setting the award. We review the amount of an attorneys' fee award for abuse of discretion. See Transgo, Inc. v. Ajac Transmission Corp., 768 F.2d 1001, 1014 (9th Cir.1985), cert. denied, 474 U.S. 1059, 106 S.Ct. 802, 88 L.Ed.2d 778 (1986). Because we find that the district court offered no adequate justification for lowering the fee below a reasonable hourly rate multiplied by the number of hours reasonably spent in preparation, we reverse and remand for a new calculation.

I. Consideration of Appropriate Criteria

Quesada argues that the district court abused its discretion by not awarding fees based on the number of hours reasonably spent on the litigation multiplied by a reasonable rate (lodestar fee). Rather, recognizing that its award did not reflect the number of hours reasonably worked multiplied by a reasonable rate, the court nonetheless reduced the presumptively reasonable lodestar fee. See City of Riverside v. Rivera, 477 U.S. 561, 106 S.Ct. 2686, 91 L.Ed.2d 466 (1986).

Deviations from the lodestar fee are not necessarily an abuse of discretion. This Circuit requires that courts reach attorneys' fee decisions by considering some or all of twelve relevant criteria set forth in Kerr v. Screen Extras Guild, Inc., 526 F.2d 67 (9th Cir.1975), cert. denied, 425 U.S. 951, 96 S.Ct. 1726, 48 L.Ed.2d 195 (1976). ¹ The court need not discuss each of the guidelines, so long as it discusses those most relevant to the particular case. See Kessler v. Associates Fin. Servs. Co., 639 F.2d 498 (9th Cir.1981). A mere statement that a court has considered the Kerr guidelines does not make a decision within the court's discretion. The court must "articulate with sufficient clarity the manner in which it makes its determination." Chalmers v. City of Los Angeles, 796 F.2d 1205, 1211 (9th Cir.1986), amended, 808 F.2d 1373 (9th Cir.1987). Although this articulation requirement does not mandate detailed calculations, "something more than a bald unsupported amount is necessary [to affirm an award of attorneys fees].... [A]t the very least, the district court must set forth the number of hours compensated and the hourly rate applied." Id. at 1211 n. 3.

In this case, we would have preferred a more detailed explanation of how the district court arrived at its decision. The brief comments offered by the district court make evaluating the reasonableness of the award difficult. Nonetheless, the district court said enough for us to review its decision. At the original fee hearing, the court explained its reasons by stating that it had considered the 12 factors, and that it believed the case was not particularly novel or difficult. The court then noted that it was most influenced by the amount involved and the results obtained.

The district court's initial reasons for setting the fee below the level that the district court itself found was reasonable for the hours reasonably worked are not sufficient. The simplicity of the issues may not be used to decrease a fee award below the amount calculated by the court as a reasonable lodestar fee. The Supreme Court has repeatedly emphasized that the lodestar fee should be presumed reasonable unless some exceptional circumstance justifies deviation. See, e.g. Pennsylvania v. Delaware Valley Citizens' Council for Clean Air, --- U.S. ----, 107 S.Ct. 3078, 3088, 97 L.Ed.2d 585 (1987). It has also explained that "[t]he novelty and complexity of the issues [is] ... fully reflected in the number of billable hours recorded by counsel and thus do not warrant an ... adjustment in a fee based on the number of billable hours times reasonable hourly rates." Blum v. Stenson, 465 U.S. 886, 898, 104 S.Ct. 1541, 1548, 79 L.Ed.2d 891 (1984). We therefore find that the district court abused its discretion by relying on the simplicity of the issues presented as a basis for reducing a fee below the lodestar.

Insofar as the district court relied on the results obtained to justify a fee below the lodestar, it was mistaken. Quesada obtained a very favorable result. He sought only money damages from the suit, and he managed to settle for nearly half of his original request, and a full seventy percent of the amount he sought at trial. Furthermore, courts should not reduce lodestars based on relief obtained simply because the amount of damages recovered on a claim was less than the amount requested. Rather, the relief obtained justifies a lower fee if plaintiffs fail to obtain relief on all claims, and if hours spent on unsuccessful claims were not needed to pursue successful claims. See Hensley v Eckerhart, 461 U.S. 424, 434-35, 103 S.Ct. 1933, 1939-40, 76 L.Ed.2d 40 (1983). Failure to obtain all relief requested for a claim on which the plaintiff prevailed should not deprive plaintiff's attorney of a reasonable hourly fee for hours needed to obtain the relief. See id. at 435-36 n. 11, 103 S.Ct. at 1940-41 n. 11.

The district court should not have reduced the attorney's fees simply because the damage award was small. Section 1988 was not enacted to encourage only those civil rights suits most likely to produce large damage awards. To the contrary, "[b]ecause damage awards do not reflect fully the public benefit advanced by civil rights litigation, Congress did not intend for fees in civil rights cases ... to depend on obtaining substantial monetary relief. Rather, Congress made clear that it 'intended that the amount of fees ... not be reduced because the rights involved may be nonpecuniary in nature.' " Rivera, 106 S.Ct. at 2695 (quoting S.Rep. No. 94-1011, p. 6 (176), reprinted in, U.S. Code Cong. & Admin.News 1976 pp. 5908, 5913 (emphasis added by Supreme Court)). Even in cases seeking only monetary relief, "a successful civil rights plaintiff often secures important social benefits that are not reflected in nominal or relatively small damage awards." Id. at 2694. Therefore, it is inappropriate for a district court to reduce a fee award below the lodestar simply because the damages obtained are small. Permitting such reductions would create an incentive to bring only those civil-rights cases that would produce large damage awards. This incentive conflicts with the purposes of section 1988. See id. at 2695-97.

The reasons offered by the district court at the fee hearing cannot support reduction of the fee below the lodestar. We therefore proceed to consider the additional reason offered by the court in support of its decision: the contingent-fee arrangement between Quesada and his attorney.

II. Consideration of the Contingent-Fee Arrangement

In deciding to lower the fee award below the lodestar, the district court relied on the contingent-fee agreement Quesada made with his attorney. Whether courts may lower fees on this ground raises an issue of first impression in this...