Smalbein ex rel. Smalbein v. City of Daytona Beach

• Decision Date: 16 December 2003
• Docket Number: No. 03-12113.,03-12113.
• Citation: 353 F.3d 901
• Parties: Claudia SMALBEIN, as co-personal representative of the ESTATE OF Paul SMALBEIN, Edward Millis, as co-personal representative of the Estate of Paul Smalbein, Plaintiffs-Appellants, v. CITY OF DAYTONA BEACH, Gary A. Sault, Officer, T.A. Perkins, Officer, individually and in their official capacity, David M. Willis, Officer, Bruce M. McBride, Officer, individually, Defendants-Appellees.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 901

353 F.3d 901

Claudia SMALBEIN, as co-personal representative of the ESTATE OF Paul SMALBEIN, Edward Millis, as co-personal representative of the Estate of Paul Smalbein, Plaintiffs-Appellants, v. CITY OF DAYTONA BEACH, Gary A. Sault, Officer, T.A. Perkins, Officer, individually and in their official capacity, David M. Willis, Officer, Bruce M. McBride, Officer, individually, Defendants-Appellees.

No. 03-12113.

United States Court of Appeals, Eleventh Circuit.

December 16, 2003.

Deborah M. Hallisky, Frederick C. Morello, Law Office of F.C. Morello, Daytona Beach, FL, for Plaintiffs-Appellants.

Marie Hartman, Daytona Beach, FL, Jeffrey Kurtz Green, Katz & Green, Palm Coast, FL, Michael John Walker, R. Matthew Miles & Assoc., P.A., Daytona Beach, FL, for Defendants-Appellees.

Appeal from the United States District Court for the Middle District of Florida.

Before CARNES, BARKETT and DUHÉ^*, Circuit Judges.

PER CURIAM:

Claudia Smalbein and Edward Millis, personal representatives of the Estate of Paul Smalbein, appeal the denial of their motion for an award of statutory attorney's fees following a settlement agreement on their claims with the City of Daytona Beach and Police Officers Gary A. Sault, T.A. Perkins, David M. Willis, and Bruce M. McBride (collectively, "Daytona Beach Defendants"). Smalbein and Millis filed their motion for fees pursuant to 42 U.S.C. § 1988(b),¹ which allows for a fee award to the "prevailing party" in suits brought for the vindication of civil rights. In response, the City of Daytona Beach requested an evidentiary hearing to determine the merits of Paul Smalbein's 42 U.S.C. § 1983 claims in order to establish whether Smalbein and Millis were eligible for § 1988(b) attorney's fees. The Magistrate Judge recommended that the motion for attorney's fees be granted but that the evidentiary hearing be denied. The district court denied both the motion for attorney's fees and evidentiary hearing. Because we find that Smalbein and Millis are prevailing parties under 42 U.S.C. § 1988, we reverse the district court's denial of the motion for attorney's fees and remand for the purpose of holding an evidentiary hearing on the award of attorney's fees and costs to Smalbein and Millis per the terms of the parties' settlement agreement.

I. BACKGROUND

Paul Smalbein, the original plaintiff, filed a ten-count complaint against the City of Daytona Beach, the City of Daytona Beach Police Department, and various police officers. Smalbein alleged that his constitutional rights under the First, Fourth, Eighth, and Fourteenth Amendments and the Civil Rights Act of 1871, 42 U.S.C. § 1983, were violated following his arrest in a night club parking lot. Specifically, Smalbein claimed that he was deprived of his due process rights, his right to be free of excessive force, and the right to reasonable medical care under § 1983. He also alleged state law claims of false imprisonment, battery, and intentional infliction of emotional distress. The complaint was later amended to allege eleven counts and named Claudia Smalbein and Edward Millis as plaintiffs after the death of Paul Smalbein.²

After mediation, the parties reached a settlement agreement whereby the City of Daytona Beach agreed to pay Smalbein and Millis $25,000. All issues raised in the amended complaint were settled except for payment of attorney's fees and taxable costs, and the parties jointly noticed the district court of their agreement. The district court dismissed the case with prejudice and referred any dispute as to the attorney's fees and costs to the Magistrate Judge for a report and recommendation. The court later amended its order and dismissed the case without prejudice until the Daytona Beach City Council approved the settlement.

Thereafter, Smalbein and Millis filed a motion for attorney's fees under § 1988(b). In response, the Daytona Beach Defendants filed a request for an evidentiary hearing on the merits of the § 1983 claims. Both the motion and the request for an evidentiary hearing were denied as premature because a final settlement had not yet been reached.

After approval by the City of Daytona Beach and disbursement of the $25,000 to Smalbein and Millis, the district court incorporated the settlement agreement by reference into its order of dismissal and retained jurisdiction for the enforcement of its terms. Smalbein and Millis re-filed their motion for attorney's fees, and the Daytona Beach Defendants responded again with a request for an evidentiary hearing on the merits of the § 1983 claims. The Magistrate Judge recommended that the evidentiary hearing be denied because the court should not be "entangled" in protracted litigation after the substantive issues of a case have been resolved. The Magistrate Judge also recommended that the motion for attorney's fees be granted because the "significant" payment to Smalbein and Millis of $25,000 and the disposal of Paul Smalbein's § 1983 claims against the Daytona Beach Defendants made them the prevailing party under § 1988(b). The district court agreed with the Magistrate Judge that an evidentiary hearing on the merits of the § 1983 claims was unnecessary but rejected the Magistrate Judge's recommendation that attorney's fees be paid.

II. STANDARD OF REVIEW

The proper standard for an award of attorney's fees is a question of law that we review de novo. Loggerhead Turtle v. County Council, 307 F.3d 1318, 1322 (11th Cir.2002) (citing Barnes v. Broward County Sheriff's Office, 190 F.3d 1274, 1276-77 (11th Cir.1999)). Any factual findings made relevant to that question are reviewed for clear error. Id. (citing Head v. Medford, 62 F.3d 351, 354 (11th Cir.1995)). A district court's decision on whether to award attorney's fees is reviewed for abuse of discretion. Id.

III. DISCUSSION

Under the "American Rule," United States courts follow "`a general practice of not awarding fees to a prevailing party'" in a suit. Buckhannon Board & Care Home, Inc., v. W. Va. Dept. of Health & Human Res., 532 U.S. 598, 602, 121 S.Ct. 1835, 149 L.Ed.2d 855 (2001) (quoting Key Tronic Corp. v. United States, 511 U.S. 809, 819, 114 S.Ct. 1960, 128 L.Ed.2d 797 (1994)). However, where Congress has given courts "explicit statutory authority" under "fee-shifting" statutes, they may award attorney's fees to the prevailing party. Id. Under § 1988(b), Congress enumerated § 1983 as one of these fee-shifting statutes; therefore, Smalbein and Millis are eligible to seek an award of attorney's fees on Paul Smalbein's § 1983 civil rights claims under § 1988(b) provided that they meet the test of being a "prevailing party." The question here is whether Smalbein and Millis qualify as the prevailing party when their claims were settled pursuant to an agreement that the district court then incorporated into its order of dismissal and over which it retained jurisdiction for the enforcement of its terms.

It is now established that in order to be considered a prevailing party under § 1988(b), there must be a "court-ordered... `material alteration of the legal relationship of the parties' necessary to permit an award of attorney's fees." Buckhannon, 532 U.S. at 604, 121 S.Ct. 1835 (quoting Tex. State Teachers Ass'n. v. Garland Indep. Sch. Dist., 489 U.S. 782, 792-93, 109 S.Ct. 1486, 103 L.Ed.2d 866 (1989)). In other words, there must be: (1) a situation where a party has been awarded by the court "`at least some relief on the merits of his claim'" or (2) a "judicial imprimatur on the change" in the legal relationship between the parties. Id. at 603, 605, 121 S.Ct. 1835 (quoting Hewitt v. Helms, 482 U.S. 755, 760, 107 S.Ct. 2672, 96 L.Ed.2d 654 (1987)). Thus, one can be a prevailing party, for example, under an enforceable judgment on the merits or under a court-ordered consent decree. Id. at 604, 121 S.Ct. 1835. Either option constitutes a material alteration in the legal relationship of the parties. One may be a prevailing party through formal entry of a consent decree as to a private settlement agreement because the agreement has the necessary judicial approval and oversight to be considered an alteration in the legal relationship of the parties warranting an award of attorney's fees under § 1988(b). Maher v. Gagne, 448 U.S. 122, 129, 100 S.Ct. 2570, 65 L.Ed.2d 653 (1980).

The Supreme Court has also held that a federal court may have jurisdiction to enforce the terms of a private settlement agreement where a court has embodied the agreement in a dismissal order or has specially retained jurisdiction over it. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 381-82, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994). In applying this precedent, we have held in this Circuit that even where there has been no formal entry of a consent decree following a settlement agreement, a district court may still award attorney's fees to the prevailing party as long as: (1) it has incorporated the terms of the settlement into the final order of dismissal or (2) it has explicitly retained jurisdiction to enforce the terms of the settlement. American Disability Ass'n v. Chmielarz, 289 F.3d 1315, 1320 (11th Cir.2002). Under either option, the district court "clearly establishes `judicially sanctioned change in the legal relationship of the parties,' as required by Buckhannon, because the plaintiff thereafter may return to court to have the settlement enforced." Id. A formal consent decree is unnecessary because the incorporation of the settlement into a court order or the explicit retention of jurisdiction over the terms of the settlement are the "functional equivalent of an entry of a consent decree." Id.

This rule is consistent with many of our sister circuits who have likewise concluded that judicial action with sufficient judicial imprimatur other than a judgment on the merits or a court-ordered consent decree may allow for an award of attorney's fees. See, e.g., Roberson v. Giuliani, 346 F.3d 75, 2003 WL 22232780 (2d Cir.2...