Raja v. Burns

• Citation: 43 F.4th 80
• Decision Date: 01 August 2022
• Docket Number: Docket No. 21-945,August Term, 2021
• Parties: Rizwan RAJA, Plaintiff-Appellant, v. John W. BURNS, City of New York, Defendants-Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (2nd Circuit)

43 F.4th 80

Rizwan RAJA, Plaintiff-Appellant,

v.John W. BURNS, City of New York, Defendants-Appellees.

Docket No. 21-945

August Term, 2021

United States Court of Appeals, Second Circuit.

Argued: February 18, 2022

Decided: August 1, 2022

Daniel L. Ackman, Law Office of Daniel L. Ackman, New York, NY, for Appellant.

Lorenzo Di Silvio (Richard P. Dearing, Scott Shorr, on the brief), for Georgia M. Pestana, Corporation Counsel of the City of New York, New York, NY, for Appellees.

Before: Calabresi, Carney, and Robinson, Circuit Judges.

Carney, Circuit Judge:

In March 2019, Rizwan Raja sued the City of New York and a City official in the U.S. District Court for the Eastern District of New York. He sought (and was denied) immediate temporary relief from the City's summary suspension of him in his role as a non-attorney representative authorized to appear in proceedings conducted by the City's Office of Administrative Trials and Hearings (OATH). A few weeks later, OATH conducted a three-day hearing on the administrative charges against Raja. The OATH proceeding concluded on April 11 with a settlement that ended Raja's suspension without an admission of wrongdoing. Raja then amended his federal court complaint, principally alleging violations of his due process rights and seeking compensatory and punitive damages under 42 U.S.C. § 1983 and under state and city law. In early 2020, the district court awarded Raja summary judgment on his due process claims related to his summary suspension. It dismissed Raja's request that the court declare the OATH rules to be unconstitutionally vague and his claim that defendants violated his due process rights by denying him the opportunity to cross-examine certain witnesses. It also dismissed Raja's claims against the City official, finding him entitled to qualified immunity.

Raja and the City then reached a financial settlement on the due process claims: on an offer of judgment made under Federal Rule of Civil Procedure 68, the City agreed to pay Raja $20,001, "plus reasonable attorneys’ fees, expenses and costs." J. App'x 105. As the prevailing party, Raja moved under 42 U.S.C. § 1988 to recover attorney's fees. He sought a fee award of $89,775, citing his counsel's 189 hours of work on the federal suit and on the related OATH proceeding. Upon referral by the district court, a magistrate judge recommended a substantially reduced fee award of $30,888. The magistrate judge recommended that the district court (1) reduce the applicable hourly rate from $475 to $400; (2) exclude the portion of billed time that was devoted in whole or in part to the OATH proceeding; and (3) apply a 40% across-the-board reduction to the claimed fee award. The district court adopted this approach, lowering the applicable hourly rate, excluding time devoted to the OATH proceeding, and applying an overall reduction primarily on the grounds that Raja's counsel sometimes grouped unrelated tasks into one time entry on his bills (a practice known as "block billing") and that Raja did not succeed on some of his claims.

On appeal, Raja challenges the 40% across-the-board reduction as unreasonable and not in keeping with his overall success in the litigation. He argues further that the hours that his counsel devoted to the OATH hearing should have been included in the fee award because they were "useful and necessary" to the federal litigation. Appellant's Br. at 30.

On abuse of discretion review, we agree with Raja that, on the record before us, the 40% overall reduction applied by the district court was not justified: the district court was able to (and in fact did) examine the block-billed entries for reasonableness, and Raja's counsel obtained a strongly favorable result for him overall, prevailing on claims that rested on the same core set of facts as did the claims that the court dismissed. We identify no error, however, in the district court's decision to exclude from the fee calculation the hours that Raja's counsel devoted to defending him in the OATH proceeding, because Raja has not shown that this work was necessary to the result achieved in the federal court.

The order of the district court is VACATED, and the case is REMANDED for further proceedings consistent with this Opinion.

BACKGROUND¹

After passing an examination and registering with the City in 2005, Rizwan Raja became credentialed to appear as a non-attorney representative before the Taxi and Limousine Commission (TLC) tribunal, a predecessor to the OATH–Taxi and Limousine tribunal. Non-attorney representatives are entitled to appear before that tribunal on behalf of New York City taxi and limousine drivers accused of violating TLC rules and facing potential suspensions or fines.

On March 1, 2019, an OATH attorney informed Raja by email that he was "summarily suspended" from acting as a non-attorney representative, effective seven days later, on March 8. J. App'x 19. Attached to the email was a letter signed by John W. Burns, OATH First Deputy Commissioner and Supervising Administrative Law Judge (ALJ), describing the misconduct allegations that underlay Raja's summary suspension and identifying legal authority for the action. The letter alleged that Raja failed to register with the tribunal as a representative, misrepresented himself to a client as an attorney, appropriated money under false pretenses, submitted a false statement to the tribunal, and engaged in disruptive verbal conduct on OATH premises. OATH directed Raja to submit a written response to Burns by March 22 if he "wish[ed] to refute" the allegations. Id. at 19, 22.

Raja retained Daniel Ackman, Esq., as counsel on the matter and, the day before the suspension was to go into effect, Raja filed suit, seeking a temporary restraining order against Burns and the City of New York. The district court held a hearing and orally denied the motion that same day. See Raja v. Burns , No. 19-cv-1328, 2019 WL 1118044, at *1 (E.D.N.Y. Mar. 11, 2019) (Chen, J. ). Raja's suspension began as scheduled, and the district court denied reconsideration soon after. Id.

On March 19, Burns filed a fresh petition against Raja in the OATH proceeding, now seeking to permanently bar Raja from representing clients at OATH. The new petition omitted two of the initial allegations (failing to register and submitting a false statement), but it added a new charge that Raja had misappropriated client funds.

Represented by Ackman, Raja participated in the three-day OATH hearing, which took place on March 22, March 28, and April 4. On April 11, before any result was announced, Raja and the City entered into a settlement that ended Raja's suspension. The stipulation of settlement contained no admission of wrongdoing by Raja.²

On April 15, Raja filed an amended complaint in the district court, asserting claims under 42 U.S.C. § 1983 against Burns and the City for alleged violations of his Fourth, Fifth, and Fourteenth Amendment rights, the New York City Charter, and OATH rules. He sought compensatory damages from both defendants (for lost income, expenses, and emotional harm), punitive damages from Burns, and costs and fees. He also asked the district court for a judgment declaring that defendants violated the U.S. Constitution, New York common law, and local law; that the OATH rules that Raja was charged with violating were unconstitutionally vague; that defendants’ summary suspension of Raja's right to represent individuals at OATH before affording him a fair hearing on the charges against him was unconstitutional; and that "defendants may not suspend [Raja's] right to practice without ... some kind of hearing where he is entitled to present eviden[ce] and state his defenses." J. App'x 76. Finally, he requested an order "that defendants remove plaintiff's name from the published list of suspended or barred representatives." Id.

In June, Raja moved for summary judgment and the defendants cross-moved to dismiss the complaint. The following year, in February 2020, the district court granted summary judgment in Raja's favor "on the federal and state procedural due process claims insofar as they relate to [his] summary suspension."³ Raja v. Burns , No. 19-cv-1328, 2020 WL 568236, at *12 (E.D.N.Y. Feb. 5, 2020) (Donnelly, J. ). At the same time, it dismissed Raja's claims "that the OATH rules are unconstitutionally vague and that the defendants violated [Raja's] right to due process by denying him the right to cross-examine all of his accusers" and, on the ground of qualified immunity, dismissed the claims against Burns. Id. As described above, Raja and the City then settled the case for $20,001 "plus reasonable attorneys’ fees, expenses and costs," on the City's offer of judgment under Rule 68. J. App'x 110.

On July 24, 2020, Raja—a "prevailing party" under 42 U.S.C. § 1988 by virtue of the district court's ruling and the financial settlement—then moved in the district court for an award of attorney's fees and costs.⁴ He sought a fee award of $89,775 for 189 hours of work by his attorney, in relation to the federal court proceeding and the OATH proceeding. The district court referred the motion to a magistrate judge for detailed consideration.

The magistrate judge issued a report and recommendation proposing a total award of $30,888 in attorney's fees—approximately 34% of what Raja sought. Raja v. Burns (Raja I ), No. 19-cv-1328, 2021 WL 1394638 (E.D.N.Y. Feb. 2, 2021) (Reyes, M.J. ) The magistrate reached that figure in three steps: First, he reduced the applicable hourly rate from the claimed $475 to $400, based on his assessment of the prevailing rate in the Eastern District of New York for civil rights cases, reenforced by the case's "lack of complexity," the "limited" nature of Raja's success, counsel's failure to provide his "usual rate" in similar cases, and counsel's "status as a solo practitioner." Id. at *4. Next, the magistrate judge applied a 40% across-the-board reduction to the 138.8 hours billed for the district court...