Smith v. Iowa State Univ. of Sci. & Tech.

• Decision Date: 23 September 2016
• Docket Number: No. 15–0852.,15–0852.
• Citation: 885 N.W.2d 620
• Parties: Dennis L. SMITH, Appellee, v. IOWA STATE UNIVERSITY OF SCIENCE AND TECHNOLOGY, State of Iowa, Appellants.
• Court: Iowa Supreme Court

885 N.W.2d 620

Dennis L. SMITH, Appellee,

v.IOWA STATE UNIVERSITY OF SCIENCE AND TECHNOLOGY, State of Iowa, Appellants.

No. 15–0852.

Supreme Court of Iowa.

Sept. 23, 2016.

Thomas J. Miller, Attorney General, Jeffrey S. Thompson, Solicitor General, and Diane M. Stahle (until withdrawal), Assistant Attorney General, for appellants.

William W. Graham and Aimee R. Campbell of Graham, Ervanian & Cacciatore, L.L.P., Des Moines, for appellee.

PER CURIAM.

The defendants Iowa State University and the State of Iowa (collectively ISU) appeal the district court's decision awarding the plaintiff Dennis Smith all of his requested attorney fees. For the reasons set forth herein, we conclude that Smith is not entitled to all fees as awarded by the district court, and we therefore reverse and remand this case for further proceedings. However, we do not agree with the court of appeals concerning what must occur on remand. It is not necessary, in our view, for Smith's counsel to prepare a new affidavit detailing the amount of attorney time spent daily on each litigation task. Hence, on further review, we vacate the court of appeals decision and provide somewhat different directions for remand.

I. Factual and Procedural Background.

Smith was formerly employed as a technical writer in the engineering department at ISU. The events of this case cover a time period from approximately 2002 to 2010, when Smith's position at the university was eliminated. Our prior opinion contains a detailed discussion of the facts. See Smith v. Iowa State Univ. of Sci. & Tech., 851 N.W.2d 1, 4–17 (Iowa 2014)

. At trial, Smith initially recovered $500,000 in damages for common-law intentional infliction of emotional distress and $784,027 in damages for statutory whistleblower violations. Id. at 17–18 ; see Iowa Code § 70A.28(2) (2007).¹ Other claims were dismissed. Smith, 851 N.W.2d at 17.

In Smith's previous appeal, we affirmed his common-law emotional-distress award in its entirety but reversed most of his whistleblower award. Id. at 38. We concluded that to prevail on the statutory whistleblower claim, Smith had to prove he had suffered harm as a result of making reports to a “public official”—namely, ISU President Gregory Geoffroy. This Smith could not do: “[W]e ... agree with the court of appeals that there is no evidence Smith suffered retaliation for reports of financial improprieties to President Geoffroy. ” Id. at 35. Nevertheless, we left in place a portion of the statutory whistleblower award—i.e., the $150,000 in damages for harm to reputation—based on ISU's failure to preserve error. Id. at 38. We reversed in part and remanded for further proceedings. Id.

On remand, Smith sought recovery of essentially all his attorney fees incurred in this litigation (and in some other satellite proceedings). The basis for Smith's request was that Iowa's whistleblower statute authorizes awards of attorney fees. It provides,

A person who violates subsection 2 is liable to an aggrieved employee for affirmative relief including reinstatement, with or without back pay, or any other equitable relief the court deems appropriate, including attorney fees and costs.

Iowa Code § 70A.28(5)(a )

(emphasis added). Otherwise, in Iowa, attorney fees are generally not recoverable in the absence of a statute or a contractual provision that permits their recovery. See

Branstad v. State ex rel. Nat. Res. Comm'n, 871 N.W.2d 291, 294 (Iowa 2015) ; Bethards v. Shivvers, Inc., 355 N.W.2d 39, 47 (Iowa 1984).

Although the statutory whistleblower claim was only one of Smith's claims, and he recovered only $150,000 on that claim, the district court awarded Smith $368,607.35 in fees and costs, amounting to virtually all of Smith's attorney fees incurred in this litigation and the other administrative and legal matters.² The district court reasoned that “all of the plaintiff's claims, successful and unsuccessful, involved a common body of facts” and that it would be “impractical to require the Court to sift through all of the legal work to determine whether each hour was related to a particular claim.”

ISU once again appealed. It argued that the attorney-fee award should be reduced for work not performed on the whistleblower claim and to account for an overall lack of success on that claim.

On appeal, we transferred the case to the court of appeals. That court concluded the district court had abused its discretion by failing to take into consideration that “a large part of Smith's whistleblowing claim—the only claim that permitted the recovery of attorney fees—was set aside by the supreme court in light of the lack of proof on the issue of causation.” The court of appeals also faulted the district court for failing to consider that “the main portion of Smith's recovery—$500,000.00 of the total $650,000.00 awarded—was based on the emotional distress claim, which is a tort claim that does not permit the recovery of attorney fees.” Accordingly, the court of appeals reversed and remanded. In addition, it stated,

On remand, the court should direct Smith's counsel to submit an attorney fee affidavit that better details the amount of time spent on each task, rather than using block billing that specifies only daily activities but does not indicate how much time was spent on each task.

One judge on the court of appeals panel dissented. He found that Smith could recover all of his attorney fees because all of his claims were tethered to a “common core of facts.” Also, he noted that the district court stated it would have awarded the $500,000 in emotional distress damages as statutory whistleblower damages if it had been necessary to do so. We granted Smith's application for further review.

II. Standard of Review.

As we have previously stated,

We review a challenge to a district court's grant of attorney fees for an abuse of discretion. We will reverse a court's discretionary ruling only when the court rests its ruling on grounds that are clearly unreasonable or untenable. When reviewing an attorney fees award for an abuse of discretion, we will correct erroneous applications of the law.

NevadaCare, Inc. v. Dep't of Human Servs., 783 N.W.2d 459, 469 (Iowa 2010)

(citations omitted).

III. Legal Analysis.

We agree with the court of appeals that the district court abused its discretion in awarding Smith all of his requested attorney fees on the ground that this case presented a “common core of facts.” Two points should be noted here. First, in considering whether a claim for which attorney fees are available and claims for which they are unavailable arise out of a common factual core, we need to focus on the underlying purpose of this inquiry. The ultimate question is whether the work for which recovery is sought can be “deemed to have been ‘expended in pursuit of’ ” a claim for which attorney fees are recoverable. See Hensley v. Eckerhart, 461 U.S. 424, 435, 103 S.Ct. 1933, 1940, 76 L.Ed.2d 40, 51 (1983)

(quoting Davis v. Cty. of Los Angeles, No. 73–63–WPG, 1974 WL 180, at *3 (C.D.Cal. June 5, 1974) ). A defendant should not be immunized “against paying for the attorney's fees that the plaintiff reasonably incurred in remedying” the violation for which attorney fees were recoverable. See

Fox v. Vice, 563 U.S. 826, 834, 131 S.Ct. 2205, 2214, 180 L.Ed.2d 45, 54 (2011).

Here, Smith asserted a number of different claims, but fees could only be recovered for the statutory whistleblower claim, which was based specifically upon Smith's reporting to President Geoffroy in August 2007 and alleged adverse consequences flowing from that reporting. Therefore, it would not be accurate to say that all of Smith's fees were reasonably spent “in pursuit of” this whistleblower claim. As ISU points out, Smith's attorneys spent considerable time exclusively on issues related only to the common-law emotional distress claim and on other matters such as a separate open-records lawsuit and an administrative proceeding alleging age discrimination. This unrelated time was not “devoted generally to the litigation as a whole.” Hensley, 461 U.S. at 435, 103 S.Ct. at 1940, 76 L.Ed.2d at 51

.

Second, when a plaintiff achieves only “partial or limited success” on the claim for which attorney fees are recoverable, a reduction in the fee award may be appropriate even if the entire lawsuit flows from a common core of facts. See id. at 436, 103 S.Ct. at 1941, 76 L.Ed.2d at 52

. The district court did not consider this issue, ending its analysis once it had concluded (erroneously in our view) that every aspect of the litigation arose out of a common core of facts.

As we have already noted, our prior appellate decision found “no evidence Smith suffered retaliation for reports of financial improprieties to President Geoffroy. ” Smith, 851 N.W.2d at 35

. Most of the $784,027 whistleblowing judgment was accordingly reversed. Smith recovered only $150,000 in reputational damages on this claim, and he recovered this amount only because ISU had failed to preserve error on the reputational damages. Id. at 38. Hence, Smith attained only partial or limited success on the statutory whistleblower claim.

In sum, given what the record shows both about the time Smith's counsel devoted to unrelated matters for which attorney fees are not authorized and Smith's partial, limited success on the statutory whistleblower claim that is the only basis for awarding attorney fees, we think the district court's attorney fee ruling amounted to an abuse of discretion.

We reaffirm today what we have held in the past:

In determining an appropriate fee award in this case, the district court should consider the general principles governing attorney fee awards in actions in which plaintiffs are only partially successful. Thus, to the extent [the plaintiff's] unsuccessful claims for retroactive relief were unrelated to her successful claims for prospective relief, the court may not award fees or costs she obviously incurred in pursuing only the unsuccessful claims. But to the extent cou

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