Johnson, Paula v. Cherry, Leland , 256 F. App'x 1 ( 2007 )

NONPRECEDENTIAL DISPOSITION
To be cited only in accordance with
Fed. R. App. P- 32.1
In the
United States Court of Appeals
FOR THE SEVENTH CIRCUIT
CHICAGO, ILLINOIS 60604
Submitted December 7, 2006
Decided November 20, 2007
Before
Honorable KENNETH F. RIPPLE, Circuit Judge
Honorable ILANA DIAMOND ROVNER, Circuit Judge
Honorable DIANE P. WOOD, Circuit Judge
No. 06-2813
PAULA JOHNSON, Appeal from the United States District
Court for the Southern District of
Illinois
Plainnfi-Appellee,
V.
Defendants.
David R. Herndon, Judge.
APPEAL OF: BARBARA I. CLINITE,
)
)
)
)
LELAND CHERRY and JAMES MISTER, ) No. 02 C 1231
)
)
)
Appellant. )
ORDER
Pursuant to Seventh Circuit Internal Operating Procedure 6(b), this successive appeal was
submitted to the same panel of judges that disposed of a prior appeal by appellant Barbara J.
Clinite. See Johnson v. Cherry, 422 F.3d 540 (7th Cir. 2005). Neither of the parties to this
appeal has included in her brief a statement indicating that oral argument is needed, see Fed. R.
App. P. 34(a)(1) and Circuit Rule 34(i), and upon review of the briefs and the record and
consideration of the standards set forth in Fed. R. App. 34(a)(2), the panel has determined
[\J
No. 06—2813
unanimously that oral argument is unnecessary. The appeal has therefore been submitted on the
briefs and the record.
The current appeal relates to Clinite’s petition for a quantum merit award of attorney fees
for her work in this litigation. As we noted in our previous decision, Clinite filed this civil rights
suit on behalf of plaintiff Paula Johnson in 2002, alleging that the defendant police officers had
arrested Johnson without probable cause. Clinite served as Johnson’s attorney until June 2004,
when Johnson informed her that she was disoharging her and engaging new counsel. 422 F.3d at
543. In or about November 2005, following our decisiOn in the prior appeal, Johnson settled her
suit against the defendants for $20,000. After learning of the settlement, Clinite filed a petition
(supported by her affidavit) with the district court contending that she was entitled to
compensation in quantum meruit from the settlement proceeds. R. 67, 77; see Rhoades v.
Norfolk & W. Ry. Ca, 399 N.E.2d 969, 974-75 (111. 1979) (when attorney who has contingent fee
agreement with client is discharged by client without cause, attorney is entitled to reasonable
compensation in quantum meruit for services rendered prior to discharge); In re Estate of
Homritz, 863 N.E.2d 842, 846 (Ill. App. Ct. 2007) (same).1 Clinite’s petition did not specify a
particular amount to which she believed was entitled, but the attachments to her affidavit
indicated that she had incurred costs in the amount of $786.93 and reported a total of 97.5 hours
of work on the case which she valued at a rate of $170 per hour (for a total lodestar of $1 6,5 75 in
fees). R. 67 Exs. A, B. At oral argument on her petition, she suggested that a fee award in the
neighborhood of $6,666 would be appropriate, as that amount equaled one-third of Johnson’s
recovery and as such was the amount to which Clinite would have been entitled (absent her
discharge) under her contingent fee agreement with Johnson. R. 101 at 6-7; R. 88 at 3.
The district court awarded Clinite her full costs but limited her fee award to $1,500.
R. 88 at 7. Although Clinite had conducted discovery on Johnson’s behalf and just prior to her
discharge had obtained a settlement offer of $20,000 from defendants —— the same amount for
which the case ultimately settled — the court concluded that Clinite’s work ultimately had not
contributed to the settlement of the case. In particular, the court believed that Clinite’s refusal to
turn over her case file to Johnson’s new attorney, Jeffery Green, had prevented Green from
building on her work and hampered his efforts to settle the case. R. 88 at 5. Clinite had
continued to hold her file pursuant to her retaining lien, and we had recognized her right to assert
such a lien in the prior appeal. 422 F.3d at 554-56. Nonetheless, the district court believed that
Clinite had prejudiced Johnson’s case by standing on her rights and refusing to produce the file.
“it is one thing to have a legal right to impress a retaining lien, but quite another to hamper a
client’s ability to successfully pursue her case, just to insure payment.” R. 88 at 5. In the court’s
View, Clinite could have adequately protected her right to compensation by pursuing a charging
1The district court had authority to consider Clinite’s petition for an award of attorney’s
fees, eyen to the extent that her entitlement to fees rests on state law, pursuant to the court‘s
supplemental jurisdiction. 28 U.S.C. § 1367(a); see Rissman v. Rissman, 229 F.3d 586, 588 (7th
Cir. 2000).
No. 062813 3
lien; instead, Clinite had stood upon her retaining lien, to the financial detriment of her former
client. Id. In taking this path, Clinite had undermined rather than contributed to the successful
resolution of the case:
Ms. Clinite dues not deserve the six thousand plus dollars she said she is entitled
to. While she did receive an offer to settle this case, Ms. Clinite did not have the
confidence of her client to consummate the settlement. Her client discharged her.
Thereafter, Ms. Johnson’s new lawyer had many, many difficulties getting the
case settled, mostly because of his inability to construct a working file. So he
settled the case because of his work not Ms. Clinite’s. Had she cooperated and
turned over her file and the discovery, she could easily have claimed the
settlement was due in large part to her work product. She cannot claim any credit
for the settlement. The new lawyer was caused to start from scratch and the result
was his not his predecessor’s. So all of the work Ms. Clinite did was for naught
as it did not contribute one bit to the resolution of the ease.
R. 88 at 6. The court did acknowledge that Clinite had performed legal services for her client,
including the taking and defending of some five depositions, and concluded that she was entitled
to some compensation “[flor that productivity and perhaps some other intangible good she surely
must have done for this ease[.]” R. 88 at 7. It was for that reason the court awarded her $1,500 in
fees, plus her costs. Clinite appeals, contending that the modest size of the fee award is
unreasonable.
We review the amount of a fee award deferentially for abuse of discretion. Eg,
Gazrtrenux v. Chicago Housing Auth, 491 F.3d 649, 659 (7th Cir. 2007). To the extent that a
district court’s discretionary determination is based on a factor that is improper, or is inconsistent
with the undisputed facts, it is necessarily an abuse of discretion. See, e.g., US. v. Global
Dish-lbs, Inc, 498 F.3d 613, 620 (7th Cir. 2007); Kempner Mobile Elem, Inc. v. Sw. Bell
Mobile Syn, 428 F.3d 706, 712 (7th Cir. 2005).
On review of the district court’s fee decision and the underlying record, we must
conclude that the district court abused its discretion in relying on Clinite’s assertion of her
retaining lien as a basis for its finding that Clinite’s work did not substantially contribute to the
settlement of the case and that, consequently, Clinite was entitled to fees of no more than $1,500.
We reach that conclusion for two reasons: (1) in the prior appeal, we sustained Clinite’s right to
assert the retaining lien; and (2) the record is devoid of evidence that there was anything material
in Clinite’s file to which Johnson and her counsel lacked access and that was needed in order to
prosecute her case.
First, in faulting for Clinite for pursuing her retaining lien, the district court made certain
statements that are in conflict with our prior decision. The court suggested, for example, that
Clinite could have adequately protected her interest in compensation by perfecting a charging
4 No. 06~2813
lien with the ultimate payor of the settlement in lieu of the retaining lien. R. 88 at 5; see 770 ILL.
COMP. STAT. 5/1. As noted, this is a suggestion that we specifically rejected in our prior opinion:
a charging lien is of use only if the attorney’s client succeeds in her lawsuit, and the attorney has
no way of knowing in advance whether her client ultimately will in fact prevail. 422 F.3d at 554-
55, 555—56. Only in hindsight, with a finalized settlement between the parties, could the district
court say that Clinite could have relied upon a charging lien to adequately ensure her right to
compensation. The court also observed that by retaining her case file pursuant to her retaining
lien, Clinite had delayed and hindered the settlement, to the financial detriment of Johnson. R.
88 at 5, 6. But the court’s reasoning reflects the false assumption that if an attorney elects to
stand on her retaining lien, the client is faced with a choice between paying the fees her counsel
has demanded or doing without the documents in her attomey’s file. On the centrary, our prior
Opinion expressly recognized that the retaining lien is not absolute and may give way to the
client’s need for the documents in her counsel’s possession. 442 F.3d at 555. We simply pointed
out that Johnson had not established such a need, and the district court had never conducted an
appropriate hearing in order to assess that need. Id. at 556.
Indeed, the record reveals no attempt by Johnson and her counsel, at any point following
Clinite’s discharge, to show that she needed access to one or more of the documents in Clinite’s
file. There have been broad assertions by Johnson’s current counsel, Green, that for want of the
file, Johnson was left in a weakened bargaining position and that the settlement was delayed (and
perhaps reduced) while Green attempted to reassemble J ohnson’s case from scratch. R. 82 at 2-
3; Johnson Br. at 2. The district court accepted these assertions as true on their face. R. 88 at 4—
5. But there is no actual evidence in the record before us that supports these assertions. Green
has never identified, for example, what documents he needed from the file in Clinite’s custody
that were not available from other sources: e.g., from the public court file, from the court
reporter(s) who recorded the depositions that were taken in this case, or from the defendants’
attorneys. In that regard, Clinite made two noteworthy representations at the fees hearing below
that have never been contradicted. First, Clinite stated that Johnson and her counsel had obtained
copies of all of the discovery from defendants” counsel, and that Johnson herself retained the
original copies of any documentary evidence she had provided to Clinite. R. 101 at 8. A pro se
memorandum that Johnson filed earlier in the case appears to support Clinite’s representation:
the memorandum indicates that Johnson had provided Jeffrey Hammel, the attorney who first
succeeded Clinite in representing Johnson and her mother in the instant case and a separate
federal suit, with “original confidential medical records[,] discovery, [and} files from Plaintiffs
[in] June [and] July 2004”; and that “defense counsel Michael Wagner released all depositions,
discovery, [and] filings to Attorney Harn[m]el for him to proceed on [these] cases.” R. 25-2
W 5, 8. Green presumably was able or would have been able to obtain these documents from
Hammiel when he succeeded Hammel as Johnson’s attorney. Second, Clinite advised the court
that her own file contained, in addition to publicly available pleadings, only written discovery,
correspondence, and her notes about the case; the file did not include copies of the depositions,
which were taken shortly before Johnson discharged Clinite and before she ordered transcripts.
No. 06-2813 5
R. 101 at 219.2.2 The record as it stands therefore suggests that Johnson and Green had access to
all of the discovery that had been conducted in the case and to any of the evidence that was
originally in J ohnson’s possession. \Vhat they did not have access to were Clinite’s notes and her
correspondence. We are given no reason to believe that those documents were essential to
Green’s ability to resolve the case on terms favorable to Johnson.
The record thus does not support the district court’s finding that Clinite’s retention of the
case file pursuant to her retaining lien hindered Green’s ability to resolve the case, and that
Clinite’s entitlement to fees should therefore be limited to no more than $1,500. Clinite has
asked this court to determine a reasonable fee amount, and Johnson has not opposed that request.
On review of the record and consideration of the relevant factors, see In re Esiaie of Callahan,
578 N.E.2d 985, 990 (Ill. 1991) (quoting Mireles v. Indiana Harbor Belt RR. Corp, 507 N.E.2d
129, 131-32 (111. App. Ct. 1987)), we conclude that Clinite is entitled to a fee award of $3,333.
We therefore VACATE the district court’s fee award and REMAND the case to the district court
WITH DIRECTIONS to award Clinite fees in the amount of $3,333 and costs in the amount of
$786.93. '
2Clinite also informed the court that she had brought her file with her to the fee hearing
and was willing to submit it to the court for its review. R. 101 at 2]. So far as the record reveals,
the court did not ask Clinite to do so.