Phetosomphone v. Allison Reed Group, Inc. , 984 F.2d 4 ( 1993 )

January 20, 1993
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
No. 92-1117
NENH PHETOSOMPHONE,
Plaintiff, Appellant,
v.
ALLISON REED GROUP, INC. d/b/a TECHNI-CRAFT PLATING,
NOEL SMITH AND CAROL MARSELLA,
Defendants, Appellees.
No. 92-1118
GARY SHOWALTER,
Plaintiff, Appellant,
v.
ALLISON REED GROUP, INC. d/b/a/ TECHNI-CRAFT PLATING,
NOEL SMITH AND CAROL MARSELLA,
Defendants, Appellees.
APPEALS FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND
[Hon. Ronald R. Lagueux, U.S. District Judge]
Before
Torruella, Circuit Judge,
Aldrich, Senior Circuit Judge,
and Boudin, Circuit Judge.
Susan Deveney with whom Michael R. Hagopian was on brief for
appellants.
Elizabeth A. Del Padre for appellee Noel Smith.
Steven A. Robinson with whom Shayle Robinson was on brief for
appellee Allison Reed Group, Inc. d/b/a/ Techni-Craft Plating.
BOUDIN, Circuit Judge. Gary Showalter and Nenh
Phetosomphone, plaintiffs in the district court, appeal from
that court's award of attorneys' fees following their
successful Title VII suit. Because we conclude that the
district court did not abuse its considerable discretion in
determining an appropriate fee award, we affirm.
I.
Plaintiffs brought separate suits, later consolidated
for trial, against Allison Reed Group, Inc. ("Allison Reed"),
Noel Smith and Carol Marsella, alleging that plaintiffs were
the victims of sexual harassment in the workplace. In their
complaints, plaintiffs sought equitable and declaratory
relief and back pay under Title VII of the Civil Rights Act
of 1964, 42 U.S.C. 2000e et seq., as well as compensatory
damages under Rhode Island law for the tort of intentional
infliction of emotional distress.
Plaintiffs' tort claim against Smith and Marsella was
tried to a jury, and the Title VII claim against Allison Reed
and Smith was tried simultaneously to the court.1 The jury
returned a verdict in favor of defendants on the state-law
claim. The court ruled, however, that plaintiffs had
established a claim of sexual harassment under Title VII
1The district court directed a verdict for Allison Reed
on the state-law count at the close of plaintiffs' case. The
court also ruled that Marsella was not a statutory "employer"
under Title VII and was therefore not a proper defendant with
respect to that count.
-2-
against Allison Reed and Smith. The court ordered defendant
Allison Reed to establish a procedure for claims of sexual
harassment, and enjoined it from allowing future sexual
harassment of Showalter should he return to work.2 The
court found that Phetosomphone had been constructively
discharged as a result of the sexual harassment and had been
out of work for eight weeks, and it awarded him back pay of
$1,737.60 plus prejudgment interest. The factual and
procedural background of this case and the court's rulings on
the merits are set forth in detail in Showalter v. Allison
Reed Group, Inc., 767 F. Supp. 1205 (D.R.I. 1991).
After its decision on the merits, the district court
invited plaintiffs to submit an application for costs and
attorneys' fees pursuant to 42 U.S.C. 2000e-5(k). The
court stated that "[t]he application for counsel fees must be
supported by a detailed, contemporaneous accounting of the
time spent by the attorneys on this case." 767 F. Supp. at
1215. Plaintiffs' counsel submitted an application seeking
attorneys' fees and costs totalling $83,177. The district
court held a hearing on the application, and directed
2At the time of trial, Showalter was out of work due to
a back injury and was receiving worker's compensation.
Because Showalter had not left his employment because of the
harassment but rather on account of the injury, the court
held that Showalter was not entitled to back pay. The court
awarded Showalter $1 in nominal damages.
-3-
plaintiffs to submit additional documentation in support of
their claim.
The district court ultimately allowed only $12,762 in
fees and $240 in costs. The court issued a 13-page opinion
explaining in detail its reasons for sharply limiting the
award both as to hours allowed and the hourly rate claimed.
The court attached to its opinion a 16-page appendix in which
it itemized each expenditure of counsel time for which
compensation was sought, and identified which had been
allowed and which had been reduced or stricken. This appeal
followed.
II.
Title VII provides that "[i]n any action or proceeding
under this subchapter the court, in its discretion, may allow
the prevailing party, other than the Commission or the United
States, a reasonable attorney's fee (including expert fees)
as part of the costs . . . ." 42 U.S.C. 2000e-5(k).
Accordingly, an award of fees under the statute is reviewed
primarily under an abuse of discretion standard, and the
trial court's range of discretion is particularly broad.
United States v. Metropolitan Dist. Comm'n, 847 F.2d 12, 14
(1st Cir. 1988). We have advised parties on more than one
occasion that "the battle [over attorneys' fee awards] is
likely to be determined in the trial court." E.g., Foley v.
City of Lowell, 948 F.2d 10, 19 (1st Cir. 1991). Moreover,
-4-
"the fee applicant bears the burden of establishing
entitlement to an award and documenting the appropriate hours
expended and hourly rates." Hensley v. Eckerhart, 461 U.S.
424, 437 (1983).
In Hensley, the Supreme Court explained that "[t]he most
useful starting point for determining the amount of a
reasonable fee is the number of hours reasonably expended on
the litigation multiplied by a reasonable hourly rate," 461
U.S. at 433, adding that adjustments could then be made to
reflect "other considerations" including the results
obtained. Id. at 434. In this case, the district court
determined compensable hours as follows: it discounted hours
such as trial time to exclude time needed only because of the
presence of the state claim; it disallowed hours spent on
specific matters that by their nature could relate only to
the state-law claim; and it disallowed hours documented so
generally that the court could not determine their connection
to the Title VII claim.3 Having derived a total number of
allowable hours, the court then multiplied them by an hourly
fee, reducing plaintiffs' requested hourly rate from $150 to
$90 per hour.
Plaintiffs' broadest challenge on this appeal is to the
concept of separating time devoted to the federal and state-
3The court also disallowed as improbable claims for
hours in excess of 12 hours by an attorney on any one day.
There is no separate challenge to this determination.
-5-
law claims. Plaintiffs appear to recognize that, considered
separately, time spent on the state-law claims would not
warrant attorney's fees, those claims being outside the ambit
of Title VII and unsuccessful to boot. Plaintiffs argue,
however, that because their Title VII and state-law claims
arose out of the same set of facts, virtually all of
counsel's efforts to prepare this case for trial related to
both the state-law and the federal claims. In these
circumstances, plaintiffs contend, the courts have rejected
attempts to attribute the hours spent in the preparation of
the case to one claim or the other, and instead have viewed
the litigation as a whole in setting an appropriate fee
award.
It is quite true that in Hensley the Supreme Court
cautioned that attempts to allocate hours between claims may
be unwarranted where an action involves related legal
theories applied to a common core of facts. 461 U.S. at 434-
35. Thus a district court may find that the federal and
state claims are so interrelated, and the time spent in
preparation of those claims so overlapping, that an attempt
to separate the time attributable to one or the other would
be futile. See, e.g., Munson v. Milwaukee Bd School Dirs.,
969 F.2d 266, 272 (7th Cir. 1992); Wagenmann v. Adams, 829
F.2d 196, 225 (1st Cir. 1987). But it does not follow that
the district court is prevented from eliminating hours
-6-
attributable to state-law claims where, as here, the court
reasonably concludes that there is not a complete overlap and
separation is proper. Indeed, in Hensley itself, where the
successful and unsuccessful claims were closely related, the
Supreme Court said generally that "[t]he district court may
attempt to identify specific hours that should be eliminated,
or it may simply reduce the award to account for the limited
success." 461 U.S. at 436-37.
In this instance there were, as the district court
found, discrete tasks performed by plaintiffs' counsel that
related only to the state-law claim for intentional
infliction of emotional distress: for example, the
development of evidence regarding the emotional harm
allegedly suffered by Showalter and Phetosomphone (because
compensatory damages were not then available under Title
VII), and efforts relating to the jury, such as jury
selection and preparation of instructions (because only the
state-law claim was tried to the jury). On the same
principle, we believe that the court was entitled to
eliminate or discount hours or other expenses that it found
would not have been incurred but for the unsuccessful state-
law claim. See Hensley, 461 U.S. at 436-37; Wagenmann, 829
F.2d at 225 (segregable expenses).
Plaintiffs next criticize the district court's
application of this concept, arguing (often in fairly general
-7-
terms but with some examples) that some of the time
discounted or disallowed should have been permitted. For
example, plaintiffs say that time spent on state
administrative proceedings, which are a predicate to filing a
Title VII claim, should have been allowed, and that too
little time was permitted for consulting with clients.
Admittedly, in excluding or limiting these hours, the
district court took a very hard line. The disallowances,
however, were not irrational: they stemmed from the district
court's decision that in these and similar instances, counsel
provided inadequate explanation of the nature of the services
for which compensation was claimed, or of their relationship
to the Title VII claims, or both. Thus, where the time
records contained entries such as "library" and "letters to
opposing counsel," the court excluded the time, noting that
the entries "left the court guessing about their purposes."
There was some basis for the district court's insistence
upon specificity. The court, which was intimately familiar
with the case, found that plaintiffs' state-law claim played
a very substantial role in plaintiffs' preparation and
prosecution of this action. The court expressly rejected the
representation of plaintiff's counsel that efforts relating
exclusively to the state-law claim comprised less than five
percent of her total work on the case, "[s]ince it [was]
readily apparent to the Court that most of the plaintiffs'
-8-
efforts were directed toward obtaining a large damage award
under state law . . . ." Compensatory damages, of course,
were not available under Title VII at the time of this trial.
Compare Civil Rights Act of 1991, Pub. L. No. 102-166, 102,
105 Stat. 1071, 1072-73 (1991).
The district court's skepticism was also grounded in its
finding that counsel had failed to submit contemporaneous
time records showing hours worked. This omission persisted
even after the court afforded counsel an opportunity to
remedy the problem.4 We have expressly advised the bar that
"the absence of detailed contemporaneous time records, except
in extraordinary circumstances, will call for a substantial
reduction in any award or, in egregious cases, disallowance."
Grendel's Den, Inc. v. Larkin, 749 F.2d 945, 952 (1st Cir.
1984); accord, Hensley, 461 U.S. at 433 ("Where the
documentation of hours is inadequate, the district court may
reduce the award accordingly."). In this case, the court did
not disallow trial counsel's claim for lack of such records,
4Counsel first submitted a computer-generated list
containing the dates that counsel had worked on plaintiffs'
case, a brief description of the tasks performed and the
number of hours expended. The court found this accounting
inadequate and requested counsel to submit contemporaneous
records. In response, counsel submitted individual time
sheets for the entries on the chronological list. The court
found that all of these time sheets were written by the same
hand in the same pen, and it concluded that the sheets had
not been prepared contemporaneously. This factual finding is
not clearly erroneous and we are bound to accept it.
-9-
but that lack did encourage the court to resolve doubts
against reimbursement.5
We also reject the claim that the district court abused
its discretion in reducing counsel's hourly rate from $150 to
$90. We have held that a district court, in fixing a
reasonable fee award, is not bound by the hourly rate
requested by the victor's counsel; rather, the court may
establish a rate that it considers reasonable based on
counsel's skill and experience and prevailing market rates.
See Metropolitan District Comm'n, 847 F.2d at 19; Wojtkowski
v. Cade, 725 F.2d 127, 131 (1st Cir. 1984). The district
court noted that plaintiffs' counsel had been practicing law
for only three years, and it stated that $75 to $90 per hour
was the court's normal range for attorneys with this level of
experience. The court awarded counsel the high end of the
range to reflect her supervisory role in the litigation.
Plaintiffs have provided us with no basis for overturning the
court's judgment.
Only one aspect of the district court's determination
gives us pause. At the outset of its opinion, the court said
5The lack of contemporaneous records did lead to one
specific disallowance, but not of time claimed by lead
counsel. Plaintiffs included in their submission the
affidavit and bill of a predecessor attorney, which listed
only a description of services and a total amount due.
Neither the time expended in total nor on individual items
was included. We see no error whatever in disallowing such
an undocumented claim.
-10-
that the relief obtained by plaintiff on the Title VII claim
was "relatively limited in comparison to the scope of the
litigation as a whole." Specifically, the court observed
that each plaintiff's complaint had sought $1 million in
compensatory damages on their unsuccessful state-law claim,
whereas plaintiffs ultimately received only $1 in nominal
damages (in the case of appellant Showalter) and $1,737 in
back pay (in the case of Phetosomphone). Thus, the court
noted, "[t]he combined monetary relief that the plaintiffs
ultimately received was less than one-tenth of one percent of
what they originally sought."
We think that plaintiffs' proportionate success on the
Title VII claim vis-a-vis their failure to prevail on the
state-law claim is irrelevant. Since the district court
eliminated from the award any compensation for hours spent on
the prosecution of the state-law claim, it would be illogical
to reduce further the award to reflect the lack of success of
that claim. It is true that in a number of cases, the courts
have stated that "the extent of a plaintiff's success is a
crucial factor in determining the proper amount of an award
of attorney's fees . . . ." Hensley, 461 U.S. at 440; see
also Foley, 948 F.2d at 19. But we think these statements
must be understood as referring to the degree of overall
success where unsuccessful claims are included in the
-11-
calculation of the number of hours for which compensation is
allowed.
Nevertheless, we do not believe that the district
court's comparison of the outcomes achieved by plaintiffs in
their federal and state-law claims requires further
proceedings. The district court expressed this view in an
introductory section of its opinion; the belief did not
manifest itself in any particular reduction in the fee award,
and the specific reductions in the award were based upon the
legitimate disallowance of hours. If the comment played any
role, it was as a general predicate to the court's
permissible decision to disallow or discount hours not shown
to be related to the successful claim.
III.
Finally, plaintiffs contend that the court erred by
disallowing its request for costs other than $240 in filing
fees. This argument need not detain us long.
The award of costs to the prevailing party, like the fee
award, is a creature of statute. Fed. R. Civ. P. 54(d)
states that "costs shall be allowed as a matter of course to
the prevailing party unless the Court otherwise directs . . .
."6 Allowable costs are listed in 28 U.S.C 1920; and 28
6Although appellants' brief suggests that costs may be
imposed directly under section 2000e-5(k), "[s]ection 2000e-
5(k) does not alter the standard by which the court awards
costs that are not attorneys' fees pursuant to Rule 54(d)."
Myrick v. TNT Overland Express, 143 F.R.D. 126, 128 (N.D.
-12-
U.S.C. 1924 provides that "the party claiming any item of
cost or disbursement shall attach thereto an affidavit, made
by himself or his duly authorized attorney or agent having
knowledge of the facts, that such item is correct and has
been necessarily incurred in the case and that the services
for which fees have been charged were actually and
necessarily performed." A "bill of costs" form (AO 133) is
made available to the prevailing party by the court; in
addition to providing a worksheet to itemize costs, the form
also provides a built-in declaration tracking the language of
the statute.
In this case, plaintiffs neglected to file a bill of
costs form or to supply any other verification that the costs
claimed were "necessarily incurred in the case" and that the
services for which compensation was sought were "actually and
necessarily performed." Rather, the affidavit submitted by
plaintiffs stated only that the costs were expended "in the
preparation and litigation of this case," which, as the
district court noted, is a broader and more inclusive
standard. The court therefore disallowed all costs other
than $240, which represented the filing fees in the two
cases; these were the only costs which, in the court's view,
Ohio 1992); accord, Goostree v. Tennessee, 796 F.2d 854, 864
(6th Cir. 1986), cert. denied, 480 U.S. 918 (1987).
-13-
could safely be assumed on their face to have been
"necessarily incurred."
The district court could permissibly have concluded that
certain other expenses, such as the cost of the depositions
of the individual defendants and the cost of an interpreter
for plaintiff Phetosomphone, were "necessary" on their face,
but we do not believe that the court was obliged to do so.
At the fee hearing, the district judge warned plaintiffs'
counsel that the initial costs submission was not a proper
bill of costs and afforded additional time for filing, but
the response was the affidavit already described. Preparing
a technically adequate application for costs was plaintiffs'
responsibility, not the court's; and it was not a difficult
or onerous responsibility, given the "bill of costs" form
available from the clerk.
* * *
Congress has provided for attorneys' fee awards in Title
VII cases. It is important that the public policy reflected
in the statute not be undone by requirements of proof that
are overly stringent or by too grudging a test of what is
reasonable. At the same time, such fee awards are peculiarly
within the expertise and discretion of the district judge.
It is often difficult to strike the proper note in
fee-setting matters, to balance the need adequately
to compensate successful counsel against the need
to burden unsuccessful defendants fairly, but no
more. The district court--which, as in this case,
has frequently lived with the litigation and the
-14-
lawyers for long period of time, and which is
likely to be more familiar with the marketplace--
has the best coign of vantage.
Metropolitan Dist. Comm'n, 847 F.2d at 20. Here the trial
judge provided an unusually detailed explanation for the
reduction in the fees and costs sought by plaintiffs. The
court's conclusions are untainted by legal error and fall
within the realm of reasonableness. Accordingly, the
district court's judgment is affirmed.
-15-
ALDRICH, Senior Circuit Judge, dissenting. I quite
agree with much of the court's opinion. Certainly an
attorney fees determination should not be a second lawsuit,
and a court's finding of the number of hours reasonably
spent, and of appropriate hourly rates in part based on first
hand appraisal of counsel's ability, should not be reviewable
except for special reason. Nor can I sympathize with
plaintiffs' unexplained and persistent disregard of formal
methodology rules. I am much troubled, however, by the
district court's approach to a primary issue in the case, the
time devoted to the state claim that would not have been
spent had that issue not been included. The federal and
state cases were not separate, but were totally related, even
with, as defendant concedes, identical witnesses. The only
difference was that federal recovery, at that time, did not
include compensatory damages. Even here there was a special
connection in that plaintiffs were obliged to show, even for
the federal count, that their own, conceded participation,
was unenjoyable and involuntary. In this circumstance, total
disregard of hours charged for such items as conferences with
clients; contacts with counsel for defendants, and
preparation for, and taking of the deposition of defendant
Smith, the principal harasser, on the ground that counsel
-15-
cannot allocate and subtract, imposes an extraordinary
burden.
As my brothers say, this might be an appropriate
occasion to adopt the suggestion in Hensley v. Eckerhart, 461
U.S. 424, 436-37 (1983), where the Court said, "The district
court may attempt to identify specific hours that should be
eliminated, or it may simply reduce the award to account for
the limited success." That, however, brings me to my real
difficulty, the district court's finding that this was a case
where the relief obtained was "truly limited in comparison to
the scope of the litigation as a whole," citing Hensley, 461
U.S. at 440. In terms, counsel "won on one minor claim for
each plaintiff."
In Riverside v. Rivera, 477 U.S. 561, 574-576
(1986), the Court said,
Unlike most private tort litigants, a
civil rights plaintiff seeks to vindicate
important civil and constitutional rights
that cannot be valued solely in monetary
terms. . . .
Because damages awards do not
reflect fully the public benefit advanced
by civil rights litigation, Congress did
not intend for fees in civil rights
cases, unlike most private law cases, to
depend on obtaining substantial monetary
relief. . . .
Thus, Congress recognized that
reasonable attorney's fees under 1988
are not conditioned upon and need not be
proportionate to an award of money
damages.
-16-
Plaintiffs had achieved the maximum possible recovery on the
federal claims, including an order against defendant employer
to improve its internal procedures with respect to sexual
harassment. By its dwelling at length on the state dollars
sought and, though not applying them mathematically,
concluding the federal claim "minor" I cannot but think that
the district court greatly depreciated the Civil Rights Act,
seriously impairing its discretion. I would favor
reconsideration.
-17-