Cecil W. Moton v. Nathan & Nathan, P.C.

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT FILED
________________________ U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
No. 08-12337 OCT 28, 2008
Non-Argument Calendar THOMAS K. KAHN
________________________ CLERK
D. C. Docket No. 07-01419-CV-IPJ
CECIL W. MOTON,
Plaintiff-Appellant,
versus
NATHAN & NATHAN, P.C.,
Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Northern District of Alabama
_________________________
(October 28, 2008)
Before CARNES, BARKETT and MARCUS, Circuit Judges.
PER CURIAM:
Plaintiff-Appellant Cecil W. Moton appeals from a final judgment entered
by the district court awarding him $500 in attorneys’ fees following the district
court’s grant of Moton’s summary judgment motion, resulting in an award of
$1000 in statutory damages, pursuant to the Fair Debt Collection Practices Act
(“FDCPA”), 15 U.S.C. §§ 1692-1692p. Moton does not challenge the resolution
of the underlying lawsuit, but instead argues that the district court abused its
discretion in assessing attorneys’ fees under the FDCPA by awarding a flat fee of
$500 instead of using the “lodestar” formula. After careful review, we vacate and
remand to the district court for further proceedings consistent with this opinion.
In FDCPA cases, we review the award of attorneys’ fees for abuse of
discretion, but “closely scrutinize questions of law decided by the district court in
reaching the fee award.” Hollis v. Roberts, 984 F.2d 1159, 1160 (11th Cir. 1993)
(quoting Camden I Condominium Ass’n v. Dunkle, 946 F.2d 768, 770 (11th Cir.
1991)). A district court abuses its discretion when it “applies the wrong law,
follows the wrong procedure, bases its decision on clearly erroneous facts, or
commits a clear error in judgment.” Tran v. Toyota Motor Corp., 420 F.3d 1310,
1315 (11th Cir. 2005) (internal quotation marks omitted).
The relevant facts are these. Moton sued Nathan & Nathan, P.C., alleging
that the firm had violated the FDCPA during its collection of a consumer debt on
behalf of Bank of America by omitting from its initial FDCPA-mandated
disclosures the required notice that a formal statutory dispute must be in writing.
On cross-motions for summary judgment, the district court entered an order in
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Moton’s favor, holding that Nathan & Nathan’s omission violated the FDCPA, and
awarded maximum FDCPA statutory damages of $1,000 to Moton. In the same
order -- and without any motion for attorneys’ fees filed by either party -- the
district court held that Nathan & Nathan’s violation was “de minimus,” and on that
basis, directed the entry of a judgment awarding to Moton “the sum of $500.00 as
reasonable attorney’s fee and costs.” Moton subsequently filed motions to alter or
amend the judgment and for an award of costs and attorneys’ fees, attaching fee
documentation not previously considered by the district court, showing 25.3
attorney hours for which compensation was sought at the rate of $250 per hour, for
a total fee request of $6,325. The district court denied Moton’s motions, standing
by the $500 in fees it had previously awarded.
The FDCPA authorizes an award to any successful plaintiff of the costs of
the action and a “reasonable attorney’s fee as determined by the court.” 15 U.S.C.
§ 1692k(a)(3). In interpreting this provision, we have held that Supreme Court
precedent in the civil rights fee-shifting context is applicable. Hollis, 984 F.2d at
1161 (“Although [Blum v. Stenson, 465 U.S. 886 (1984)] was decided in the
context of the civil rights fee-shifting statute, its principles are equally applicable
here.”). Under the Supreme Court’s approach, we said, “[t]he initial estimate of a
reasonable attorney’s fee is properly calculated by multiplying the number of hours
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reasonably expended on the litigation times a reasonable hourly rate.” Id. (quoting
Blum, 465 U.S. at 888). In addition, “‘reasonable fees’ under § 1988 are to be
calculated according to the prevailing market rates in the relevant community.” Id.
(quoting Blum, 465 U.S. at 888). Our clear precedent thus requires a district court,
when awarding attorneys’ fees under the FDCPA -- like under the typical fee-
shifting statute -- to do the following:
The starting point in fashioning an award of attorney’s fees is to
multiply the number of hours reasonably expended by a reasonable
hourly rate. This “lodestar” may then be adjusted for the results
obtained. Although a district court has wide discretion in performing
these calculations, the court’s order on attorney’s fees must allow
meaningful review -- the district court must articulate the decisions it
made, give principled reasons for those decisions, and show its
calculation.
Loranger v. Stierheim, 10 F.3d 776, 781 (11th Cir. 1994) (citations and quotations
omitted).
The district court did not do this here. Rather, the district court awarded a
flat fee of $500.00, based on the amount of damages plaintiff received, without so
much as attempting to perform a “lodestar” analysis, nor articulating what it
deemed to be reasonable fees or reasonable hours for the attorneys’ work on this
case. It also never explained why the flat rate it awarded deviated as it did from
the “lodestar” calculation. Although the district court admittedly has wide
discretion in this arena, we nonetheless are constrained to hold that the district
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court abused its discretion by failing to perform any “lodestar” calculation at all.
See Camacho v. Bridgeport Financial, Inc., 523 F.3d 973, 982 (9th Cir. 2008)
(FDCPA case holding that “the district court erred by awarding a ‘flat award,’ and
on remand the court should calculate the lodestar to determine a presumptively
reasonable fees-on-fees award before assessing whether upward or downward
adjustments are warranted”).1
Accordingly, we vacate and remand to the district court to calculate
attorneys’ fees using the “lodestar” analysis.
VACATED AND REMANDED.
1
The cases cited by Nathan & Nathan, purporting to hold that a flat-fee award is
permissible under the FDCPA, are not binding on us, and in any event, are not helpful here.
Indeed, in French v. Corporate Receivables, Inc., 489 F.3d 402 (1st Cir. 2007), the district court,
though briefly, did say that it had performed the “lodestar” calculation and then adjusted
accordingly. And in Carroll v. Wolpoff & Abramson, 53 F.3d 626 (4th Cir. 1995), it is hard to
tell from the opinion whether the district court calculated the “lodestar” and then deviated from
it, or whether it never calculated it at all. Moreover, the plaintiff there did not win the maximum
amount of statutory damages, but rather, received only $50 in statutory damages at the close of
underlying litigation, which was five percent of amount she initially sought. Finally, in Johnson
v. Eaton, 80 F.3d 148 (5th Cir. 1996), the plaintiff won no damages at all, and therefore, the
court held that she was not entitled to any attorneys’ fees.
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