Montcalm Publishing v. Commonwealth of VA , 199 F.3d 168 ( 1999 )

PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
MONTCALM PUBLISHING CORPORATION,
Plaintiff-Appellant,
and
DONALD ARLIS HODGES; MICHAEL
GLYNN FLORA,
Plaintiffs,
v.
COMMONWEALTH OF VIRGINIA; RONALD
ANGELONE, in his official capacity as
Director of the Department of
Corrections of the Commonwealth
of Virginia; R. J. BECK; J. HORTON;
R. A. YOUNG; E. C. MORRIS; MS.
No. 99-6308
SUMMERS; JOHN DOE, 1 - 7, in their
official capacities such fictitious
names being designed to identify
those VDOC employees whose true
identities are now unknown to
plaintiff-intervenor, but who serve
as (a) members of the VDOC
Publication Review Committee, (2)
Warden or Superintendent of Keen
Mountain Correctional Center
(KMCC), and (3) functional KMCC
mailroom censor; J. Phippin; MR.
BECK,
Defendants-Appellees.
Appeal from the United States District Court
for the Western District of Virginia, at Roanoke.
Samuel G. Wilson, Chief District Judge.
(CA-92-696-R, CA-92-907-R)
Argued: October 27, 1999
Decided: December 3, 1999
Before WIDENER and MOTZ, Circuit Judges,
and BUTZNER, Senior Circuit Judge.
_________________________________________________________________
Reversed and remanded by published opinion. Judge Motz wrote the
opinion, in which Judge Widener and Senior Judge Butzner joined.
_________________________________________________________________
COUNSEL
ARGUED: Keith S. Orenstein, ORENSTEIN & ORENSTEIN, P.C.,
New York, New York, for Appellant. Mark Ralph Davis, Senior
Assistant Attorney General, Criminal Division, OFFICE OF THE
ATTORNEY GENERAL, Richmond, Virginia, for Appellees. ON
BRIEF: Mark L. Earley, Attorney General, Criminal Division,
OFFICE OF THE ATTORNEY GENERAL, Richmond, Virginia, for
Appellees.
_________________________________________________________________
OPINION
DIANA GRIBBON MOTZ, Circuit Judge:
This appeal presents questions as to whether, and to what extent,
the limits on attorney's fees in the Prison Litigation Reform Act gov-
ern fees sought by a non-prisoner who intervenes in a case originally
brought by a prisoner. We agree with the district court that the Act's
fee caps do apply to the fees requested by the intervenor here. The
district court, however, imposed these caps on all legal work per-
formed throughout the course of litigation, both before and after the
effective date of the Act. Because the Supreme Court's recent deci-
sion in Martin v. Hadix, 119 S. Ct. 1998 (1999), restricts the Act's
reach to fees for services performed after its effective date, we must
reverse and remand for further proceedings.
2
I.
In 1992, two inmates at Keen Mountain Correctional Center, Don-
ald Hodges and Michael Flora, initiated this civil rights action by fil-
ing separate pro se complaints. They alleged that prison officials had
violated their First Amendment rights by preventing them from
receiving Gallery magazine because of its graphic, sexually explicit,
and at least arguably obscene material. The district court denied the
corrections officials' motion for summary judgment and referred the
cases to a magistrate judge, who consolidated the two cases.
A year after the first pro se complaint was filed and prior to any
evidentiary hearing, Montcalm Publishing Corporation, the publisher
of Gallery, moved to intervene in the consolidated action. The magis-
trate judge granted that motion. Montcalm, too, challenged the correc-
tional officials' refusal to distribute Gallery to the inmates. Montcalm
alleged that Virginia Department of Corrections Division Operating
Procedure 852 (DOP 852), which permits official interception of
obscene publications, violated its First Amendment and due process
rights. Specifically, Montcalm asserted that DOP 852 infringed on its
rights: "(a) to be free from prior governmental restraints on the publi-
cation of Gallery magazine, (b) to be free from the outright suppres-
sion of its publication of Gallery magazine, (c) to be free from the
arbitrary, capricious and invidious suppression of its publication of
Gallery magazine, and (d) to adequate notice and a reasonable oppor-
tunity to be heard before its publication of Gallery magazine is
restrained or suppressed by the government." Montcalm's Complaint
¶ 19.
The district court upheld the constitutionality of DOP 852 in all
respects. See Hodges v. Virginia, 871 F. Supp. 873 (W.D. Va. 1994).
Montcalm alone appealed to this court. On appeal, Montcalm argued
only that DOP 852 violated its due process right to receive notice and
an opportunity to be heard before its publications were disapproved
for receipt by prisoners. We agreed with Montcalm on this issue and
reversed. See Montcalm Publ'g Corp. v. Beck, 80 F.3d 105, 106 (4th
Cir.), cert. denied, 519 U.S. 928 (1996). After the prison officials
unsuccessfully petitioned for rehearing and for certiorari to the
Supreme Court, the district court issued a memorandum opinion and
order consistent with our mandate.
3
Montcalm then moved for an award of attorney's fees under 42
U.S.C. § 1988(b) (Supp. II 1996). That statute empowers a court to
award reasonable attorney's fees to prevailing parties in federal civil
rights actions. The district court found that Montcalm constituted a
prevailing party entitled to reasonable attorney's fees under § 1988,
but that all such fees were limited by the Prisoner Litigation Reform
Act (PLRA), 42 U.S.C. § 1997e(d) (Supp. II 1996). The PLRA pro-
vides that in certain cases "[n]o award of attorney's fees . . . shall be
based on an hourly rate greater than 150 percent of the hourly rate
established . . . for payment of court-appointed counsel."
§ 1997e(d)(3). The district court applied the PLRA's rate limits to all
of Montcalm's requested fees for legal services provided over the
entire course of the litigation. After determining that the number of
hours for which Montcalm sought recovery was excessive, the district
court granted Montcalm a reduced award.
Montcalm appeals, asserting that the district court improperly
applied the PLRA to its attorney's fees award and erroneously
reduced its compensable hours.
II.
Montcalm's first and principal argument is that the PLRA "does
not operate as a limitation on the attorney's fees that may be recov-
ered by a nonprisoner." Brief of Appellant at 10.
Montcalm notes the myriad provisions in the PLRA narrowing
judicial relief available to prisoners, establishing new requirements
for prisoners seeking such relief, and imposing penalties on prisoners
bringing frivolous lawsuits. See Alexander S. v. Boyd, 113 F.3d 1373,
1379-80 n.6 (4th Cir. 1997) (summarizing various provisions of
PLRA), cert. denied, 118 S. Ct. 880 (1998). Montcalm also relies on
portions of the legislative history of the PLRA in which various legis-
lators stated the view that the Act "contains several measures to
reduce frivolous inmate litigation." See, e.g., 141 Cong. Rec. S14,317
(daily ed. Sept. 26, 1995) (statement of Sen. Abraham). The structure
of the statute and its legislative history, Montcalm contends, "demon-
strate[ ] that Congress intended the restrictions on the recovery of
attorney's fees to be applicable solely to prisoners and their lawyers
4
bringing lawsuits challenging the conditions of the prisoners' impris-
onment." Brief of Appellant at 20.
Although the PLRA's structure and history are also consistent with
a legislative desire to curb judicial involvement in the "daily opera-
tion of federal and state correctional facilities," Alexander S., 113
F.3d at 1379, certainly the statute's focus is to limit litigation brought
by prisoners. Thus, Montcalm's argument that the statute applies
"solely to prisoners" is not unreasonable. It is, however, an argument
at odds with the plain language of the statute.
The PLRA expressly imposes limitations on the amount of attor-
ney's fees awarded "[i]n any action brought by a prisoner who is con-
fined to any jail, prison, or other correctional facility." 42 U.S.C.
§ 1997e(d)(1). Thus, Congress has mandated that statutory fee limits
apply not "solely to prisoners" but to "any action brought by a pris-
oner." Unquestionably, the case at hand is one"brought by a pris-
oner." Indeed, two prisoners, Hodges and Flora, initiated this case;
Montcalm merely intervened. Thus, application of the PLRA is ines-
capable.
Although this holding may seem harsh, it is dictated by Mont-
calm's decision not to bring an independent action but to intervene in
the prisoners' action. Montcalm must now live with the consequences
of that decision. Moreover, our holding accords with the general rule
that "the intervenor is treated as if he were an original party." 7C
Charles Alan Wright et al., Federal Practice and Procedure § 1920
(2d ed. 1986); see also 1 Mary F. Derfner & Arthur D. Wolf, Court
Awarded Attorney's Fees ¶ 7.03 (1998) (explaining that intervenors
are "generally eligible for an award of fees just as though they were
an original party to the litigation").*
_________________________________________________________________
*We recognize that a court, in its discretion, may regard intervention
as a separate action when the intervenor has an independent basis for
jurisdiction. See Atkins v. State Bd. of Educ. , 418 F.2d 874, 876 (4th Cir.
1969); accord Harris v. Illinois-California Express, Inc., 687 F.2d 1361,
1367 (10th Cir. 1982); Fuller v. Volk, 351 F.2d 323, 328 (3d Cir. 1965).
Montcalm, however, has not asserted that a federal court would have an
independent basis for jurisdiction over its claim in the absence of a pris-
oner complaint; nor has Montcalm asked either the district court or this
court to exercise any discretion to treat its intervention as a separate
action. Accordingly, we have no occasion to consider such arguments.
5
III.
Much of the legal work in this case--that done at the trial level on
the merits and on direct appeal--was performed prior to the effective
date of the PLRA, April 26, 1996. In accordance with then-
controlling circuit precedent, see Alexander S. , 113 F.3d at 1388, the
district court applied the PLRA caps to all of the fees requested by
Montcalm.
After the district court ruled on Montcalm's petition for attorney's
fees, however, the Supreme Court issued Martin v. Hadix, 119 S. Ct.
1998 (1999). The Court there held that the PLRA"limits attorney's
fees with respect to postjudgment monitoring services performed after
the PLRA's effective date but it does not so limit fees for postjudg-
ment monitoring performed before the effective date." Id. at 2001
(emphasis added).
Neither party has briefed the significance of Hadix here. At oral
argument counsel for the corrections officials, while acknowledging
the rule enunciated in Hadix, suggested that it may not apply in the
case at hand because in Hadix the prevailing parties' entitlement to
reasonable fees was recognized in an order that substantially ante-
dated the effective date of the PLRA. Thus, the reliance interest of the
prevailing parties and their attorneys in Hadix was stronger than that
in the present case, in which no pre-existing order acknowledged that
reasonable attorney's fees would be awarded for satisfactory services
rendered.
This argument is not without force. We recognize the factual dif-
ferences between this case and Hadix. The reliance interest of Mont-
calm's attorneys is certainly less firmly based, resting as it does
entirely on the existence of a federal statute--42 U.S.C. § 1988--
which permits a court to award reasonable fees to parties who prevail
in establishing a violation of federal law. However, although the
Supreme Court carefully set forth the facts of the case in its opinion
in Hadix, it seems to us that the holding in Hadix cannot fairly be read
to be confined to those facts.
Both at the beginning and at the end of its opinion in Hadix, the
Court stated its holding in general terms without emphasis on the pre-
6
existing fee award order. Thus, at the outset of the opinion, the Court
summarized its holding:
We conclude that § 803(d)(3)[42 U.S.C.§ 1997e(d)(3)] lim-
its attorney's fees with respect to postjudgment monitoring
services performed after the PLRA's effective date but it
does not so limit fees for postjudgment monitoring per-
formed before the effective date.
Hadix, 119 S. Ct. at 2001. Similarly, the Court concluded its opinion
explaining:
[T]he PLRA contains no express command about its tempo-
ral scope. Because we find that the PLRA, if applied to post-
judgment monitoring services performed before the
effective date of the Act, would have a retroactive effect
inconsistent with our assumption that statutes are prospec-
tive, in the absence of an express command by Congress to
apply the Act retroactively, we decline to do so.
Id. at 2008 (citation omitted).
In view of this general language, we believe that Hadix must be
read to hold that the PLRA's limit on attorney's fees does not apply
to legal services performed prior to the Act's effective date. This con-
clusion accords with our recent interpretation of Hadix, see Altizer v.
Deeds, 191 F.3d 540, 544 (4th Cir. 1999) (summarizing Hadix as
holding that "the PLRA's limitation on attorneys' fees may not be
applied to services performed prior to the PLRA's enactment"), and
that of other courts. See, e.g., Chatin v. Coombe, 186 F.3d 82, 90 (2d
Cir. 1999) (noting that "[i]n Hadix, the Supreme Court ruled that, in
a case filed prior to the effective date of the PLRA, § 803(d)(3)
applied to legal work performed after the effective date, but not to
legal work performed before it"); Ilick v. Miller, ___ F. Supp. 2d ___,
1999 WL 781654 (D. Nev. Sept. 28, 1999) (ruling that"prior section
1988 law applies to all fees billed up to the effective date of the
PLRA (i.e., April 26, 1996), and that the PLRA fee cap applies to all
fees billed after that date").
7
Accordingly, we remand this case to the district court so that it may
award attorney's fees in light of Hadix. We note that the district court
indicated in its opinion the hourly rates it would have applied if it had
concluded that the PLRA did not govern. The court based those rates
on uncontroverted affidavits from local attorneys attesting to the rea-
sonableness of such rates in that community. Montcalm contends,
however, that it should receive reimbursement at the standard rates of
its New York counsel.
"[T]he community in which the court sits is the first place to look
to in evaluating the prevailing market rate." Rum Creek Coal Sales,
Inc. v. Caperton, 31 F.3d 169, 179 (4th Cir. 1994); see also National
Wildlife Fed'n v. Hanson, 859 F.2d 313, 317 (4th Cir. 1988). If a mat-
ter is so complex or specialized that "no attorney, with the required
skills, is available locally," a court may, of course, award fees for
counsel located elsewhere. Id. In the case at hand, however, the dis-
trict judge, who was intimately familiar with this litigation, concluded
that this case was "straightforward and uncomplicated" and could
have been competently performed by available local counsel. Our
careful review of the record reveals no abuse of discretion in this
assessment.
IV.
Finally, Montcalm argues that the district court improperly reduced
the number of compensable hours for which fees would be awarded.
The district court awarded Montcalm fees for only 76.15 of the
511.6 hours it claimed for work at the trial level. The court reached
this calculation first by eliminating 180 hours for discovery and 27
hours for an evidentiary hearing. (The court also deducted the related
expenses claimed for each.) The district court found, and Montcalm
does not dispute, that the procedural due process claim on which
Montcalm prevailed involved "no factual issues;" thus, neither the
discovery nor the hearing were relevant to Montcalm's single suc-
cessful claim. Accordingly, elimination of the fees and expenses
devoted to discovery and the evidentiary hearing seems entirely justi-
fied.
The district court awarded only 25% of the remaining 304.6 hours
requested for the trial phase. "[B]ecause Montcalm failed to properly
8
document its billing records," the court had to estimate how much
time the attorneys spent on the successful procedural due process
claim as opposed to the three other constitutional claims Montcalm
asserted. The court explained that on the basis of its experience with
"this litigation and the documents filed in the case," it believed that
"Montcalm's attorneys devoted the bulk of their efforts to the First
Amendment issues." But in order to "give Montcalm the benefit of the
doubt" it "assume[d] that its attorneys devoted their efforts equally
between [sic] the four alleged violations."
Montcalm maintains that all issues in the case were interrelated
and, therefore, the district court should award fees"without any
reduction in time to account for the lack of success proper on the First
Amendment cause of action." Brief of Appellant at 26. We find, how-
ever, that although Montcalm's four claims are all related to the sup-
pression of Gallery magazine by Virginia corrections officials, they
were not inseparable. Montcalm's core claim was that DOP 852 con-
stituted an unconstitutional prior restraint or"outright" governmental
suppression of speech; its fall-back position was that DOP 852 consti-
tuted an unconstitutionally arbitrary, capricious, and invidious sup-
pression of speech; and its ultimate fall-back position was that DOP
852 was unconstitutional because it suppressed speech without notice
or an opportunity to be heard. The only contention on which Mont-
calm prevailed--the "ultimate fall-back," solely procedural contention
--is markedly different and less complex than those on which it did
not prevail.
We recognize that "a mathematical approach comparing the total
number of issues in the case with those actually prevailed upon" is
inappropriate. See Hensley v. Eckerhart, 461 U.S. 424, 435 n.11
(1983). Attorneys may devote significantly different amounts of time
to issues of varying complexity. Moreover, "[w]here a plaintiff has
obtained excellent results, . . . the fee award should not be reduced
simply because the plaintiff failed to prevail on every contention
raised in the lawsuit." Id. at 435. However, a careful review of the
record in this case reveals no abuse of the district court's discretion
in reducing the award for fees incurred at the trial level.
Finally, Montcalm asked for an award of 344.5 hours for the appel-
late phase of the litigation. This phase included the appeal to this
9
court, the response to the petition for certiorari to the Supreme Court,
the litigation on remand, and the attorney's fees petition. Montcalm
litigated only the procedural due process issue throughout this phase
of the litigation. The district court nonetheless held that the request
for fees in the appellate phase was also "excessive." The court
explained that Montcalm appealed a novel but uncomplicated issue,
noting that Montcalm itself described the procedural due process
claim as a "very simple issue" in its opposition to the petition for cer-
tiorari in the Supreme Court. The district court also noted that Mont-
calm had briefed and researched this issue during the lower court
phase. Explaining that it "ha[d] difficulty believing" the publisher
needed "the equivalent of one attorney working over eight forty-hour
weeks" for the appellate phase, the court reduced by 25% the hours
for the appellate phase.
Once again, it appears to us that the district court in no way abused
its discretion in arriving at this conclusion. We do note that at one
point in its opinion the district court indicated that it would allow
Montcalm 172.3 hours for the appellate phase and in another that it
would allow 256.875 hours. Neither of these figures equals precisely
75% of 344.5; we trust the district court will clarify the calculations
on remand.
V.
For the foregoing reasons, we affirm the district court's conclusion
that the PLRA attorney's fees limits apply to the fees requested by
Montcalm in this action. We remand, however, so that the court may
properly apply such limits only to those fees incurred after the effec-
tive date of the PLRA.
REVERSED AND REMANDED
10