M.B. v. Jennifer Tidball ( 2021 )

United States Court of Appeals
For the Eighth Circuit
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No. 20-1886
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M.B., by next friend Ericka Eggemeyer
Plaintiff - Appellee
E.S., by next friend A.S.; Z.S., by next friend S.H.
Plaintiffs
K.C., by next friend Kris Dadant; A.H., by next friend Kealey Williams
Plaintiffs - Appellees
v.
Jennifer Tidball, in her official capacity as Acting Director of the Missouri
Department of Social Services; Tim Decker, in his official capacity as Director of
the Children’s Division
Defendants - Appellants
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Appeal from United States District Court
for the Western District of Missouri - Jefferson City
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Submitted: April 13, 2021
Filed: November 16, 2021
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Before LOKEN, WOLLMAN, and STRAS, Circuit Judges.
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STRAS, Circuit Judge.
After the parties settled a lawsuit involving Missouri’s foster-care system, the
district court 1 awarded over $3 million in attorney fees and expenses to the plaintiffs.
See 42 U.S.C. § 1988(b). We affirm.
I.
The plaintiffs, who sued on behalf of a group of foster children, alleged that
Missouri did not have adequate procedures in place to guard against the overuse of
psychotropic drugs. The plaintiffs alleged that the procedures were so inadequate,
in fact, that they created a host of statutory and constitutional problems. See U.S.
Const. amend. XIV; 42 U.S.C. §§ 621 et seq., 670 et seq.; see also 42 U.S.C. § 1983.
To remedy the situation, the plaintiffs sought injunctive and declaratory relief.
Among the changes demanded were the creation of an updated medical-records
system, development of an informed-consent policy, and the addition of a
secondary-review system to identify and track “outlier” prescriptions.
The parties eventually settled, but not before sparring over a motion to
dismiss, engaging in discovery, vigorously debating class certification, briefing and
orally arguing an appeal, and participating in mediation. The settlement, which the
parties reached nearly two years into the case, brought numerous changes to
Missouri’s foster-care system.
The defendants, who are a pair of state officials, agree that the settlement
addressed “the issues raised in [the complaint]” and that the plaintiffs were the
“prevailing parties.” See 42 U.S.C. § 1988(b). Finding no reason to disagree, the
district court approved the settlement and awarded the plaintiffs $3,253,651.25 in
fees and another $132,907.56 in expenses. The award, which was approximately
1
The Honorable Nanette K. Laughrey, United States District Judge for the
Western District of Missouri.
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16% under the overall request, reflected the work of four organizations, including
two non-profit firms. The question on appeal is whether the court abused its
discretion by refusing to reduce the award even more. See Hanig v. Lee, 415 F.3d
822, 825 (8th Cir. 2005).
II.
Under “the bedrock principle known as the American Rule,” litigants pay their
own attorney fees, “win or lose, unless a statute or contract provides otherwise.”
Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242, 253 (2010) (internal
quotation marks omitted). Here, 42 U.S.C. § 1988(b) provides otherwise by
allowing “[t]he [district] court, in its discretion,” to award “a reasonable attorney[]
fee” to “the prevailing party.” The parties have already stipulated that the plaintiffs
“prevail[ed],” so the only question for us is whether the award is reasonable. See
Fish v. St. Cloud State Univ., 295 F.3d 849, 851 (8th Cir. 2002) (recognizing that
parties who settle can still “prevail[]”); see also Maher v. Gagne, 448 U.S. 122, 129
(1980) (same).
In calculating “a reasonable . . . fee,” 42 U.S.C. § 1988(b), the district court
used what has come to be known as the “lodestar.” See Hanig, 415 F.3d at 825; see
also Perdue v. Kenny A. ex rel. Winn, 559 U.S. 542, 551 (2010) (calling the lodestar
“the guiding light of our fee-shifting jurisprudence” (quotation marks omitted)). The
lodestar calculation is simple: it involves “multiplying the number of hours
reasonably expended” on the case “by the reasonable hourly rates.” Hanig, 415 F.3d
at 825 (quotation marks omitted); see also Perdue, 559 U.S. at 551 (explaining that
the lodestar is a “rough[] approximat[ion]” of what an attorney would charge a
paying client).
The district court calculated “the number of hours reasonably expended” by
deducting the time entries that reflected staffing inefficiencies or were too vague.
See Hanig, 415 F.3d at 825. Using fee surveys and other evidence, it also reduced
the hourly rates of over half of the 20 attorneys who worked on the case. Multiplying
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the adjusted figures together yielded a lodestar of $3,253,651.25, just shy of the
nearly $3.9 million that the plaintiffs had requested. See id.A.
Although the defendants do not challenge any of these calculations directly,
they believe that the district court improperly flipped the burden. In their view,
rather than requiring the plaintiffs to prove that their own fee request was
reasonable, as it should have, the court placed the burden on them to establish its
unreasonableness. See Hensley v. Eckerhart, 461 U.S. 424, 437 (1983) (stating that
it is the fee applicant’s burden to “establish[] entitlement to an award”). We read
the court’s order differently.
From the start, the order made clear that the burden was on the plaintiffs. It
was, according to the district court, their responsibility to support the hours claimed
with documentary evidence and to “establish[] the appropriate rate.” The court then
evaluated the billing records, attorney-by-attorney, and disregarded any entries that
were excessive or vague, leaving no doubt that the plaintiffs had failed to prove their
entitlement to all the fees and expenses they had requested.
To be sure, the district court also explained why the defendants’ rebuttal
evidence did not measure up. It pointed out several flaws, including the absence of
“declarations by local attorneys who deem[ed] [the] fees unreasonably high” and the
lack of specific examples of attorneys who “spen[t] an inordinate amount of time”
on tasks. But read in context, what the court was saying was that the defendants had
not rebutted the “accuracy and reasonableness of [some of] the hours charged,”
Gates v. Deukmejian, 987 F.2d 1392, 1397–98 (9th Cir. 1982), not that they had
failed to meet some burden of their own. See Blum v. Stenson, 465 U.S. 886, 892
n.5 (1984) (concluding that the party opposing the fee request waived its right to
challenge reasonableness by failing to submit evidence).
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B.
As a fallback argument, the defendants urge us to reduce the award because,
in their view, they have overcome the “‘strong presumption’ that the lodestar figure
is reasonable.” Perdue, 559 U.S. at 554. None of the considerations 2 they identify,
however, clears this hurdle, id. at 553–54, much less convinces us that the district
court abused its discretion in setting the fee award, see Hanig, 415 F.3d at 825.
1.
The first consideration raised by the defendants is the possibility that such a
large award would result in a “windfall.” Perdue, 559 U.S. at 559 n.8. For support,
they point to the small operating budgets of the two non-profit firms that worked on
the case: Children’s Rights and National Center for Youth Law.
The Supreme Court has already foreclosed this argument. Over three decades
ago, it explained that fees “are to be calculated according to the prevailing market
rates in the relevant community,” Blum, 465 U.S. at 895, not “the [actual] cost of
providing legal services,” id. at 892. It makes no difference, in other words, whether
a “nonprofit legal services organization” is working on the case, as here, or high-
priced “private counsel.” Id. at 894. The rate is the same, regardless of whether
some might view it as a “windfall.” Id. at 895 (quotation marks omitted); see id. at
2
Two considerations are not before us. The first—the alleged disparity in the
size of the award compared to others in “similar cases”—was never supported with
specific examples. See Johnson v. Ga. Highway Express, Inc., 488 F.2d 714, 719
(5th Cir. 1974) (considering this factor). The second—the allegedly limited success
that the plaintiffs achieved—was never raised as a reason to reduce the award. See
id. at 718 (explaining that “the results obtained” are a relevant consideration). If the
district court failed to analyze these considerations in its otherwise thorough opinion,
it is only because the defendants failed to discuss them. See Hensley, 461 U.S. at
437 (discussing the reasons to deviate from the lodestar “[w]hen an adjustment is
requested” (emphasis added)).
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895–96 (“The policy arguments advanced in favor of a cost-based standard should
be addressed to Congress rather than to this Court.”).
2.
The second consideration is the flip side of the first. The concern is that
Missouri’s taxpayers will end up footing the bill for what is, in the defendants’ view,
an excessive fee award.
Nothing, however, is unusual about this scenario. “[I]n many cases, attorney[]
fees awarded under § 1988 . . . are paid in effect by state and local taxpayers,” rather
than “the individuals responsible for the constitutional or statutory violations.”
Perdue, 559 U.S. at 559 (emphasis added). We cannot say that the district court
abused its discretion by declining to provide special treatment for a common
situation. See id.III.
We accordingly affirm the judgment of the district court.
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