(Volume 3, Issue 3)
In May 2013, the United States District Court for the Western District of Oklahoma made a $116,148.15 reduction to the $145,148.50 fee request by plaintiff’s attorneys in a Title VII work-place discrimination suit. This 80 percent reduction in fees was, in part, the result of the court’s determination that counsel failed to exercise billing judgment by overstaffing and by filing inconsequential appeals. A substantial portion of the reduction reflected a downward adjustment to the lodestar amount due to a relative lack of success on the underlying claims.
The court first addressed the possibility of overstaffing and duplicative billing considering that “[v]irtually all of the tasks undertaken by [P]laintiff’s counsel involved the substantial involvement of at least two attorneys.” Although the court suggested that the use of more than one attorney is unremarkable, at instant, the court took exception with the substantial review and revision of documents undertaken by multiple attorneys and the substantial amount of time spent in “interoffice conferences between counsel,” given the purported experience of counsel. The court also reduced the award for the use of a second lawyer at trial when the record showed that the second lawyer had little to no participation over the short duration of the trial. Lastly, the court reduced the award in light of counsel’s decision to staff a third lawyer, unfamiliar with the case at hand, to prepare the response to Defendant’s summary judgment motion when two other lawyers had handled all of the pretrial proceedings. In light of Plaintiff’s Counsel’s use of block billing, which prevented an accurate culling of the duplicative hours, the court reduced the total hours expended by 30 percent to reflect the excess time spent on matters above, reducing the initial lodestar amount to $101,603.95.
Next, the court addressed whether the relative lack of success on the merits warranted a reduction from the initial lodestar amount. Given the almost nominal recovery in this case—especially when compared to what Plaintiff sought at the pleading stage—the Court determined that a two-thirds reduction was necessary based on the results obtained. This adjustment, tentatively, reduced the fee award to $33,868.
Finally, the court addressed whether the time spent on post-judgment motions by Plaintiff’s counsel, with regards to both a motion for pre- and post-judgment interest and the motion for attorneys’ fees, was reasonable given the low level of recovery at issue. Given that the applicable interest rates would have resulted in an award of $1.79 in pre-judgment interest, the court was not impressed by counsel’s motion for interest and, ultimately, held that any entries billed in connection with the motion for interest would be excluded. Additionally, the court took exception with counsel’s fee motion, which generated a fee request exceeding the Plaintiff’s recovery, and excluded any hours expended on this motion as well. Again due to counsel’s practice of block billing, the court elected to exclude all entries that included any time attributable to either motion since it was impossible to effectively parse the block-billed entries. Overall, this exclusion amounted to a $5,332.50 adjustment in the overall fee awards.
In sum, the court awarded only 20% of the legal fees requested, a total of $29,000.35 in fees and costs, for a case that resulted in a $2,984 jury award following a two-day trial.
Implications for Legal Billing: This decision highlights that attorneys must staff judiciously and work to eliminate inefficiencies created by the use of multiple attorneys. Whether a case requires the work of two or more attorneys is case-specific, but prevailing counsel that does not effectively monitor its hours throughout the process risks facing large reductions for inefficient work.
The court’s decision also highlights that success on the merits is a necessary factor when adjusting the initial lodestar amount. An attorney who seeks a substantial fee for a relatively nominal award risks large deductions, or possibly the denial of attorneys’ fees altogether.
Finally, the decision demonstrates that when block billing impedes the court’s meaningful review of the billing entries the court is more apt to apply an across the board percentage reduction to the block billed entries.
* Cox v. Council for Developmental Disabilities, Inc., 2013 WL 1915066 (W.D. Okla. 2013). Full copies of court decisions may be available through counsel or through various Internet links or paid services.
By Riley Orloff