Opinion

Theresa Duran v. Department of Justice

Court: Merit Systems Protection Board
Filed: Mar 19, 2024
Status: Unpublished
Cited by: 0 cases
Authority: More cited than 15.6%

recognizing that the lodestar may be adjusted based on the results obtained when it is not taken into account in calculating the lodestar figure in the first instance

How later courts described this case

recognizing that the lodestar may be adjusted based on the results obtained when it is not taken into account in calculating the lodestar figure in the first instance

Written by the judges who cited it.

The opinion

UNITED STATES OF AMERICA

MERIT SYSTEMS PROTECTION BOARD

THERESA M. DURAN, DOCKET NUMBERS

Appellant, DE-531D-16-0329-A-1

DE-531D-16-0470-A-1

DEPARTMENT OF JUSTICE,

Agency. DATE: March 19, 2024

THIS FINAL ORDER IS NONPRECEDENTIAL 1

Stephen Goldenzweig , Esquire, Houston, Texas, for the appellant.

Jennifer A. Weger , Esquire, Washington, D.C., for the agency.

BEFORE

Cathy A. Harris, Chairman

Raymond A. Limon, Vice Chairman

FINAL ORDER

The agency has filed a petition for review of the addendum initial decision,

which awarded the appellant $201,989.40 in attorney fees and $8,946.40 in costs.

For the reasons discussed below, we GRANT the agency’s petition for review and

AFFIRM the initial decision AS MODIFIED, decreasing the amount of the

attorney fee award. Except as expressly MODIFIED by this Final Order, the

initial decision is the Board’s final decision.

A nonprecedential order is one that the Board has determined does not add

significantly to the body of MSPB case law. Parties may cite nonprecedential orders,

but such orders have no precedential value; the Board and administrative judges are not

required to follow or distinguish them in any future decisions. In contrast, a

precedential decision issued as an Opinion and Order has been identified by the Board

as significantly contributing to the Board’s case law. See 5 C.F.R. § 1201.117(c).

BACKGROUND

On December 15, 2015, the appellant filed an appeal of her removal for

medical inability to perform and raised affirmative defenses of disability

discrimination (failure to accommodate), retaliation for prior equal employment

opportunity (EEO) activity, and whistleblower reprisal. Duran v. Department of

Justice, MSPB Docket No. DE-0752-16-0116-I-1/2. Subsequently, on June 2,

2016, the appellant filed an appeal of the denial of a within grade increase (WIGI)

in 2013 (Duran v. Department of Justice, MSPB Docket No. DE-531D-16-0329-I-

1/2) and on September 7, 2016, an appeal of a constructive denial of a WIGI in

2015 (Duran v. Department of Justice, MSPB Docket No. DE-531D-16-0470-I-

1/2). In both WIGI appeals, she raised affirmative defenses of EEO and

whistleblower reprisal. All three appeals were initially joined on September 16,

2016, for discovery and hearing, but joinder was terminated on July 24, 2017,

prior to the issuance of the initial decisions in each case.

In MSPB Docket No. DE-531D-16-0329-I-2, the administrative judge

reversed the agency’s reconsideration decision denying the appellant a WIGI in

2013 and found that the agency’s actions constituted reprisal for the appellant’s

protected EEO activity (filing EEO complaints and requesting reasonable

accommodations). 2 In MSPB Docket No. DE-531D-16-0470-I-2, the

administrative judge reversed the agency’s constructive denial of the appellant’s

WIGI in 2015 but found that the appellant did not prove her affirmative defenses

of EEO or whistleblower reprisal. The initial decisions became the Board’s final

decisions when neither party filed a petition for review. In MSPB Docket

No. DE-0752-16-0116-I-2, the administrative judge affirmed the agency’s

removal and found that the appellant failed to prove any of her affirmative

defenses. On review, the Board affirmed the initial decision, as modified, still

The administrative judge found that the appellant failed to prove her affirmative

defense of whistleblower reprisal. Duran v. Department of Justice, MSPB Docket

No. DE-531D-16-0329-I-2, Appeal File, Tab 75 at 19-21.

sustaining the removal and finding that the appellant failed to prove her

affirmative defenses.

On December 30, 2017, the appellant filed a motion for attorney fees and

costs in connection with the Board’s final orders reversing the agency’s WIGI

denials. Duran v. Department of Justice, MSPB Docket No. DE-531D-16-0329-

A-1, Attorney Fee File (0329 AFF), Tab 1; Duran v. Department of Justice,

MSPB Docket No. DE-531D-16-0470-A-1, Attorney Fee File (0470 AFF), Tab 1.

In her motion, she sought $315,353.52 in attorney fees and costs incurred by the

two law firms that had represented her: the Law Offices of Eric L. Pines, PLLC

(Pines Law Firm), and Kalijarvi, Chuzi, Newman, & Fitch, P.C. (KCNF). Id.

The administrative judge issued an addendum initial decision awarding the

appellant attorney fees and costs in the amount of $210,935.80. 0329/0470 AFF,

Tab 21, Addendum Initial Decision (AID). In particular, she awarded $85,124.40

in attorney fees to KCNF and $116,865.00 in attorney fees to the Pines Law Firm.

AID at 16. She further ordered the agency to pay costs in the amount of $898.72

to KCNF and $8,047.68 to the Pines Law Firm. Id.

The agency has filed a petition for review arguing that the fees awarded are

excessive because the administrative judge failed to reduce the total amount to

account for the appellant’s limited success in prevailing in only two of her three

appeals. Petition for Review (PFR) File, Tab 1. The appellant has filed a

response in opposition to the petition for review, and the agency has filed a reply.

PFR File, Tabs 3-4.

DISCUSSION OF ARGUMENTS ON REVIEW

To receive an award of attorney fees under 5 U.S.C. § 7701(g)(1), an

appellant must show the following: (1) she was the prevailing party; (2) she

incurred attorney fees pursuant to an existing attorney-client relationship; (3) an

award of attorney fees is warranted in the interest of justice; and (4) the amount

of attorney fees claimed is reasonable. 3 See Caros v. Department of Homeland

Security, 122 M.S.P.R. 231, ¶ 5 (2015). The agency has not challenged the

appellant’s prevailing party status, that she incurred attorney fees pursuant to an

existing attorney-client relationship, or that an award of attorney fees is

warranted. Nor does the agency challenge the costs awarded. Accordingly, we

limit our review of the addendum initial decision to whether the fees awarded are

reasonable.

In Hensley v. Eckerhart, 461 U.S. 424 (1983), the Supreme Court set forth

a scheme for determining a reasonable fee award in a case when, as in this case,

the prevailing party did not obtain all the relief requested. The most useful

starting point, the Court explained, is to take the hours reasonably spent on the

litigation multiplied by a reasonable hourly rate. Id. at 433; see Driscoll v. U.S.

Postal Service, 116 M.S.P.R. 662, ¶ 10 (2011). This is the “lodestar” that the

Board uses in determining the fee award. Lizut v. Department of the Navy,

42 M.S.P.R. 3, 7-8 (1989). The initial calculation should exclude hours for which

the prevailing party failed to provide adequate documentation and hours that were

not reasonably expended. Hensley, 461 U.S. at 433-34.

In the second phase of the analysis, the lodestar may be adjusted upward or

downward based on other considerations, including the crucial factor of the

“results obtained.” Id. at 434. If the party seeking fees has achieved only

“partial or limited success,” an award based on the hours reasonably spent on the

litigation as a whole times an hourly rate may be an excessive amount, even when

Under 5 U.S.C. § 7701(g)(2), when the appellant is a prevailing party and the decision

is based on a finding of discrimination prohibited under 5 U.S.C. § 2302(b)(1), attorney

fees may be awarded in accordance with the standards prescribed under 42 U.S.C.

§ 2000e–5(k). The provision at 42 U.S.C. § 2000e–5(k) states that the court, “in its

discretion, may allow the prevailing party . . . a reasonable attorney’s fee . . . as part of

the costs.” The Board has held that 5 U.S.C. § 7701(g)(2) is a broader standard than

5 U.S.C. § 7701(g)(1). See Chin v. Department of the Treasury, 55 M.S.P.R. 84, 86

(1992). Thus, because the appellant prevailed on her affirmative defense of reprisal, the

administrative judge properly analyzed whether any fees or costs not recoverable

pursuant to section 7701(g)(1) were recoverable pursuant to section 7701(g)(2). AID at

14-15.

the claims were interrelated, nonfrivolous, and raised in good faith. Id. at 436.

In this scenario, the tribunal awarding fees has discretion to make an equitable

judgment as to what reduction is appropriate. Id. at 436-37. It may adjust the

lodestar downward by identifying specific hours that should be eliminated or, in

the alternative, by reducing the overall award to account for the limited degree of

success. Id.; Smit v. Department of the Treasury, 61 M.S.P.R. 612, 619 (1994).

The former method should be used in cases when it is practicable to segregate the

hours devoted to related but unsuccessful claims. See Boese v. Department of the

Air Force, 784 F.2d 388, 391 (Fed. Cir. 1986); Smit, 61 M.S.P.R. at 619-20.

Here, the administrative judge found that the total fees sought by KCNF

were reasonable. AID at 9. Regarding the Pines Law Firm, the administrative

judge found that 26 hours were not reasonable because they were related to the

appellant’s removal appeal, not her WIGI appeals. AID at 8. She acknowledged

that a total of 499.1 attorney hours was an inordinate amount of time for the

appellant’s counsel to spend on two WIGI appeals, but nonetheless she found

such time reasonable in light of what she described as the agency’s “scorched

earth litigation tactics.” AID at 10. In particular, she noted that the appellant’s

counsel had to respond to the agency’s frivolous motions and contend with the

agency’s resistance to responding to basic discovery. AID at 10. Having

determined which hours were reasonable, the administrative judge declined to

adjust the lodestar, again citing the agency’s actions as well as noting that the

appellant prevailed on both WIGI appeals and there was a finding of a prohibited

personnel practice in one WIGI appeal. AID at 14.

We agree with the agency that the administrative judge’s analysis did not

fully acknowledge the appellant’s lack of success on her removal appeal or

appropriately eliminate the fees related to the appellant’s unsuccessful removal

appeal. Rather, her analysis appears to have conflated the issues of whether the

hours spent were reasonable and whether an adjustment to the lodestar was

appropriate in light of the appellant’s level of success. AID at 8-14; see Driscoll,

116 M.S.P.R. 662, ¶ 10 (stating that a reduction of the lodestar to account for the

party’s success on only some of her claims for relief is distinct from a finding

that hours devoted to unsuccessful claims or issues were not reasonably spent).

Nonetheless, we decline to remand the case to the administrative judge. The

record in this case is fully developed, and in the interest of the efficient use of

judicial resources, we modify the addendum initial decision as set forth below.

We modify the addendum initial decision to disallow 30 hours for time spent by

KCNF on the appellant’s removal appeal.

As stated, the administrative judge determined that all of the fees sought by

KCNF were reasonable and she declined to adjust the lodestar downward. AID

at 9-10. The record reflects that the agency argued that KCNF’s fees prior to

June 1, 2016, should have been disallowed because the appellant’s WIGI denial

appeals were not filed until June 2, 2016. 0329/0470 AFF, Tab 7 at 5-6. Such

fees were for work related to mediation, settlement, discovery, and responding to

an affirmative defenses order in the removal appeal. 0329/0470 AFF, Tab 1

at 14-24. In response, the appellant argued that the discovery was prepared in

connection with all three appeals and the affirmative defenses response was also

being prepared with the WIGI issues in mind. 0329/0470 AFF, Tab 10 at 5. The

appellant also submitted affidavits from a KCNF attorney indicating that,

whenever possible, the bills submitted were adjusted to reflect only the time spent

on work relevant to the 2013 and 2015 WIGI appeals. 0329/0470 AFF, Tab 14

at 13-14, Tab 17 at 9.

In allowing such fees, the administrative judge found that the appellant

presented persuasive evidence that the issue of the WIGI denials was raised

during the mediation process for which KCNF sought fees. AID at 9. However,

she did not address the agency’s argument that the remaining fees prior to June 1,

2016, should be excluded. We find that KCNF’s fees from January 11 to 13,

2016 (excluding .3 hours for attorney RRR on January 13, 2016) related to

discovery should have been disallowed. 0329/0470 AFF, Tab 1 at 17. Discovery

during this time could have related only to the removal appeal because the WIGI

appeals had not yet been filed. As such, we disallow .3 hours for attorney RRR

(at an hourly rate of $602) and 6.9 hours for attorney AAH (at an hourly rate of

$334) for a total of $2,485.2.

Similarly, we disallow KCNF’s fees from December 28, 2015, to January 5,

2016 (excluding .1 and .5 hours for fees related to settlement by attorney RRR on

January 5, 2016). 0329/0470 AFF, Tab 1 at 15-16. The record reflects that such

fees were related to researching, drafting, and filing a response to the

administrative judge’s December 21, 2015 affirmative defenses order in the

removal appeal and participating in a status conference in the removal appeal. Id.

We are not persuaded by the appellant’s conclusory statement below that such

work was related to the WIGI appeals. 0329/0470 AFF, Tab 10 at 5. The charges

for drafting the response to the affirmative defenses order certainly relate solely

to the removal appeal. Additionally, to the extent the appellant was asserting that

research was done with the WIGI affirmative defenses in mind, the affirmative

defenses raised in the removal appeal were based on different facts than those

raised in the WIGI denials, which had not yet been filed. As such, we disallow

7 hours for attorney RRR (at an hourly rate of $602) and 15.8 hours for attorney

ALK (at an hourly rate of $334) for a total of $9,491.20. Thus, the lodestar for

KCNF is reduced to $66,992.40 ($78,968.80 - $11,976.40). Because the record

reflects that KCNF’s remaining charges were reduced to reflect only the portion

of time spent on the WIGI appeals, we find that no further reduction of these

charges is necessary. Accordingly, the addendum initial decision is modified and

the appellant is awarded $73,148 ($66,992.40 + $6,155.60 in fees related to the

fee petition) in attorney fees, plus $898.72 in costs, for a total award of

$74,046.72 to KCNF.

We exercise our equitable discretion and impose a 15 percent reduction in the

lodestar calculation for the Pines Law Firm based on the appellant’s

limited success.

Regarding the Pines Law Firm, the administrative judge disallowed

26 hours that were clearly severable and related solely to the appellant’s

unsuccessful removal appeal. AID at 8. However, the remaining charges were

taken in furtherance of all three actions, which were joined from September 16,

2016, to July 24, 2017. 0329/0470 AFF, Tab 1 at 67-82. Unlike KCNF, whose

work largely occurred prior to the joinder of the cases, the record does not reflect

that the bills submitted by the Pines Law Firm were reduced to reflect only the

portion of time spent on the successful WIGI appeals. We find that it is not

practicable to segregate from the remaining hours those hours related to the

appellant’s unsuccessful removal appeal. As a result, the lodestar figure fails to

account for the appellant’s limited success and a full award of attorney fees

would be unreasonably high. Thus, the Board has discretion to make an equitable

adjustment to the lodestar calculation. See Bywaters v. United States, 670 F.3d

1221, 1229 (Fed. Cir. 2012) (recognizing that the lodestar may be adjusted based

on the results obtained when it is not taken into account in calculating the

lodestar figure in the first instance); see also Guy v. Department of the Army,

118 M.S.P.R. 45, ¶¶ 3, 21 (2012) (adjusting the lodestar calculation in an

individual right of action appeal when an appellant only successfully challenged

some of the personnel actions).

We find that a 15 percent reduction of the lodestar calculation is

appropriate and that such a reduction sufficiently accounts for the fact that the

appellant’s removal was sustained and she failed to prevail on any of her

affirmative defenses in that appeal. Therefore, we reduce the $103,005 lodestar

for the Pines Law Firm by $15,450.75. Accordingly, the addendum initial

decision is modified and the appellant is awarded $101,414.25 ($87,554.25 +

$13,860 in fees related to the fee petition) in attorney fees, plus $8,047.68 in

costs, for a total award of $109,461.93 to the Pines Law Firm.

ORDER

We ORDER the agency to pay attorney fees in the amount of $74,046.72 to

Kalijarvi, Chuzi, Newman & Fitch, P.C., and $109,461.93 to the Law Office of

Eric Pines, PLLC. The agency must complete this action no later than 20 days

after the date of this decision. Title 5 of the United States Code, section 1204(a)

(2) (5 U.S.C. § 1204(a)(2)).

We also ORDER the agency to tell the appellant and the attorneys promptly

in writing when it believes it has fully carried out the Board’s Order and of the

actions it has taken to carry out the Board’s Order. We ORDER the appellant and

the attorneys to provide all necessary information that the agency requests to help

it carry out the Board’s Order. The appellant and the attorneys, if not notified,

should ask the agency about its progress. See 5 C.F.R. § 1201.181(b).

No later than 30 days after the agency tells the appellant or the attorneys

that it has fully carried out the Board’s Order, the appellant or the attorneys may

file a petition for enforcement with the office that issued the initial decision on

this appeal, if the appellant or the attorneys believes that the agency did not fully

carry out the Board’s Order. The petition should contain specific reasons why the

appellant or the attorneys believes the agency has not fully carried out the

Board’s Order, and should include the dates and results of any communications

with the agency. See 5 C.F.R. § 1201.182(a).

NOTICE OF APPEAL RIGHTS 4

The initial decision, as supplemented by this Final Order, constitutes the

Board’s final decision in this matter. 5 C.F.R. § 1201.113. You may obtain

review of this final decision. 5 U.S.C. § 7703(a)(1). By statute, the nature of

Since the issuance of the initial decision in this matter, the Board may have updated

the notice of review rights included in final decisions. As indicated in the notice, the

Board cannot advise which option is most appropriate in any matter.

your claims determines the time limit for seeking such review and the appropriate

forum with which to file. 5 U.S.C. § 7703(b). Although we offer the following

summary of available appeal rights, the Merit Systems Protection Board does not

provide legal advice on which option is most appropriate for your situation and

the rights described below do not represent a statement of how courts will rule

regarding which cases fall within their jurisdiction. If you wish to seek review of

this final decision, you should immediately review the law applicable to your

claims and carefully follow all filing time limits and requirements. Failure to file

within the applicable time limit may result in the dismissal of your case by your

chosen forum.

Please read carefully each of the three main possible choices of review

below to decide which one applies to your particular case. If you have questions

about whether a particular forum is the appropriate one to review your case, you

should contact that forum for more information.

(1) Judicial review in general . As a general rule, an appellant seeking

judicial review of a final Board order must file a petition for review with the U.S.

Court of Appeals for the Federal Circuit, which must be received by the court

within 60 calendar days of the date of issuance of this decision. 5 U.S.C.

§ 7703(b)(1)(A).

If you submit a petition for review to the U.S. Court of Appeals for the

Federal Circuit, you must submit your petition to the court at the following

address:

U.S. Court of Appeals

for the Federal Circuit

717 Madison Place, N.W.

Washington, D.C. 20439

Additional information about the U.S. Court of Appeals for the Federal

Circuit is available at the court’s website, www.cafc.uscourts.gov. Of particular

relevance is the court’s “Guide for Pro Se Petitioners and Appellants,” which is

contained within the court’s Rules of Practice, and Forms 5, 6, 10, and 11.

If you are interested in securing pro bono representation for an appeal to

the U.S. Court of Appeals for the Federal Circuit, you may visit our website at

http://www.mspb.gov/probono for information regarding pro bono representation

for Merit Systems Protection Board appellants before the Federal Circuit. The

Board neither endorses the services provided by any attorney nor warrants that

any attorney will accept representation in a given case.

(2) Judicial or EEOC review of cases involving a claim of

discrimination . This option applies to you only if you have claimed that you

were affected by an action that is appealable to the Board and that such action

was based, in whole or in part, on unlawful discrimination. If so, you may obtain

judicial review of this decision—including a disposition of your discrimination

claims —by filing a civil action with an appropriate U.S. district court ( not the

U.S. Court of Appeals for the Federal Circuit), within 30 calendar days after you

receive this decision. 5 U.S.C. § 7703(b)(2); see Perry v. Merit Systems

Protection Board, 582 U.S. 420 (2017). If you have a representative in this case,

and your representative receives this decision before you do, then you must file

with the district court no later than 30 calendar days after your representative

receives this decision. If the action involves a claim of discrimination based on

race, color, religion, sex, national origin, or a disabling condition, you may be

entitled to representation by a court-appointed lawyer and to waiver of any

requirement of prepayment of fees, costs, or other security. See 42 U.S.C.

§ 2000e-5(f) and 29 U.S.C. § 794a.

Contact information for U.S. district courts can be found at their respective

websites, which can be accessed through the link below:

http://www.uscourts.gov/Court_Locator/CourtWebsites.aspx .

Alternatively, you may request review by the Equal Employment

Opportunity Commission (EEOC) of your discrimination claims only, excluding

all other issues . 5 U.S.C. § 7702(b)(1). You must file any such request with the

EEOC’s Office of Federal Operations within 30 calendar days after you receive

this decision. 5 U.S.C. § 7702(b)(1). If you have a representative in this case,

and your representative receives this decision before you do, then you must file

with the EEOC no later than 30 calendar days after your representative receives

this decision.

If you submit a request for review to the EEOC by regular U.S. mail, the

address of the EEOC is:

Office of Federal Operations

Equal Employment Opportunity Commission

P.O. Box 77960

Washington, D.C. 20013

If you submit a request for review to the EEOC via commercial delivery or

by a method requiring a signature, it must be addressed to:

Office of Federal Operations

Equal Employment Opportunity Commission

131 M Street, N.E.

Suite 5SW12G

Washington, D.C. 20507

(3) Judicial review pursuant to the Whistleblower Protection

Enhancement Act of 2012 . This option applies to you only if you have raised

claims of reprisal for whistleblowing disclosures under 5 U.S.C. § 2302(b)(8) or

other protected activities listed in 5 U.S.C. § 2302(b)(9)(A)(i), (B), (C), or (D).

If so, and your judicial petition for review “raises no challenge to the Board’s

disposition of allegations of a prohibited personnel practice described in section

2302(b) other than practices described in section 2302(b)(8), or 2302(b)(9)(A)(i),

(B), (C), or (D),” then you may file a petition for judicial review either with the

U.S. Court of Appeals for the Federal Circuit or any court of appeals of

competent jurisdiction. 5 The court of appeals must receive your petition for

review within 60 days of the date of issuance of this decision. 5 U.S.C.

§ 7703(b)(1)(B).

If you submit a petition for judicial review to the U.S. Court of Appeals for

the Federal Circuit, you must submit your petition to the court at the

following address: