Amicus Curiae Brief — Marek v. Chesny

Supreme Court brief1985

Ask Donna

What actually matters in this document.

Text

Office - Supreme Court, US.

FILED

SEP 14 1994

No. 83-1437

eenemmmmmemm ti c STEVAS

i CLERK

— —

IN THE

Supreme Court of the United States

OCTOBER TERM, 1984

JEFFREY MAREK, THOMAS WADYCKI

AND LAWRENCE RHODE,

Petitioners,

ALFRED W. CHESNY,

Respondent.

ON WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

BRIEF OF THE ALLIANCE FOR JUSTICE AS

AMICUS CURIAE ON BEHALF OF ITS MEMBERS*

SUPPORTING RESPONDENT

LAURA MACKLIN

Institute for Public Representation

600 New Jersey Avenue, N.W.

Washington, D.C. 20001

(202) 624-8390

Counsel of Record for the

Alliance for Justice as Amicus Curiae

* The members of the Alliance for Justice, who join in the

filing of this amicus brief, are listed on the inside cover.

THE CASILLAS PRESS, INC. 1717 K Street N.W. « Washington, D.C. + 223-1220

The members of the Alliance for Justice, who join

in the filing of this amicus brief, include:

Business and Professional People

for the Public Interest

Center for Law and Social Policy

Center for Law in the Public Interest

Center for National Policy Review

Center for Science in the Public

Interest

Consumers Union

Education Law Center

Employment Law Center

Environmental Defense Fund

Equal Rights Advocates

Food Research and Action Center

Harmon & Weiss

Institute for Public Representation

Juvenile Law Center

Mental Health Law Project

NOW Legal Defense and Education Fund

National Wildlife Federation

National Women’s Law Center

Native American Rights Fund

New York Lawyers for the Public

Interest

Public Advocates, Inc.

Sierra Club Legal Defense Fund

Women’s Law Project

Women’s Legal Defense Fund

QUESTION PRESENTED

Whether Rule 68 of the Federal Rules

of Civil Procedure should be interpreted

by the Court as requiring a district

judge to deny a prevailing plaintiff in a

civil rights case recovery for attorney's

fees under 42 U.S.C. Section 1988 (and

other similarly worded federal fee-

shifting statutes) for all services

rendered after the rejection of a Rule 68

offer of judgment if the plaintiff fails

to obtain a judgment as favorable as the

offer.

TABLE OF CONTENTS

QUESTION PRESENTED . . . . «© «© « «

TABLE OF CONTENTS ... +++ « «

TABLE OF AUTHORITIES . . «. « « « «

INTEREST OF AMICUS CURIAE ....

SUMMARY OF ARGUMENT ....+24e6-s

ARGUMENT . . «© «© © © © © © © © @

I. THE TERM “COSTS” IN RULE

68 DOES NOT INCLUDE

ATTORNEY'S FEES ..... «

A. The Drafters and Revisers

of the Federal Rules of

Civil Procedure Have

Retained the Traditional

Distinction Between Fees

ONG Gueeeeccceseeee oe

B. Congress, In Its 1938

Approval of the Federal

Rules of Civil Procedure,

Did Not Amend, Sub

Silentio, Existing Fee-

Shifting Statutes ....

C. Nor Did Congress, in

Enacting the Civil Rights

Attorney's Fees Award Act

of 1976, Abrogate the

Distinction in the Federal

Rules Between Fees and

COGGB wc cece eeeee es

II.

IIl.

Nor Has Congress

Abrogated the Rules’

Distinction Between Fees

and Costs by Enacting

Other Fee-Shifting

Statutes in Recent Years .

"Plain Meaning” Tenets

of Statutory Construction

Do Not Compel A Reading

of Attorney's Fees as

Part of Costs Under the

Federal Rules .... >

THE ISSUE RAISED IN THIS

CASE IS APPROPRIATE FOR

LEGISLATIVE, NOT JUDICIAL,

RESOLUTION . «© «© «© «© © © «© «

THE INTERPRETATION URGED

BY THE PETITIONERS WILL

ENGENDER MANY PROBLEMS ..

Under Rule 68, Plaintiffs

and Their Counsel Must

Forfeit All Fees For

Post-Offer Services,

Regardless of Their

Reasonableness and Good

Faith in Rejecting the

GBBGS esreeoeevses

The Petitioners’

Interpretation of Rule 68

Will Engender Substantial

Litigation on Collateral

Issues eh in oe a 2

IV. THE RULE URGED BY PETITIONERS

IS NOT NECESSARY TO CURB ANY

ALLEGED LITIGATON PROBLEMS

CONCLUSION

vi Vii

TABLE OF AUTHORITIES Coleman vy, Stanziani,

Page 570 F. Supp. 679 (E.D.

appeal

CASES: Pa. 1983),

, 735 F.2d 118

Alyeska Pipeline Service Co, [oe Gale BOOS) coccccecesce §

vy. Wilderness Society,

Cases 898 (D. Conn.

1983) eeoeeeeereeeeeeeeeeeeee 22 ’ No. 75-O105-R

State Bar

(E.D. Va. filed 1975) ..... 5,6

, 104 S. Ct.

1541 (1984) eseeeeeeeeveeeeee 37

’

635 F.2d 652 (7th Cir.

1980) e*eeeeoeeveeenereneeeeeeeeeeee 62

, 278 U.S.

United States

eae

Angeles, 8 E.P.D. ¥ 9444

, 612 F.2d (C.D. Cal. 1974) eoeesenseeoeeneee#es 4

1057 (7th Cir. 1980) ....-- 61

Cameron vy, Montgomery County

Child Welfare Service,

471 F. Supp. 761 (E.D.

Pa. 1979) eeeeeeeeeeeneeeenenee 5,6

August, 450 U.S. 346

(1981) eeeeeeeeeeeeeeeeeeee 14,55-56

° Fulps vy. City of Springfield,

715 F.2d 1088 (6th Cir.

’ 720 F.2d 1983) eeeeseeeeweeeeteeeeneeneeeeee 21

474 (7th Cir. 1983),

cert, granted, 104 S. Ct. Gamlen Chemical Co, v.

2149 (1964) ccccccccccccces 26 Dacar Chemica] Products,

5 F.R.D. 215, 216 (W.D.

Ras GEO coccdocsestcecces BB

Lstij uro_ Garment Co,

vy. EEOC, 434 U.S. 412

(1978) eeeeeeeeeeeeeeeeeeee 50-51 ’ 616 F.2d

1268 (5th Cir. 1980),

. ted, 636 F.2d

421 U.S. 240 (1975) eoeeeeene 13 ,26,37 Columbus Board of Education

vy. Penick, 443 U.S. 449

Bitsouni vy. Sheraton (1979) eoeee eer eereeeeeeeeeee 4

Hartford Corp,, 33 F.E.P.

Consumers Union v. Virginia

942 (1981) eoeeeeeeeeeeeeees 26-27

Vili

, 88

F.R.D. 225 (D.R.I. 1980) ..

, 425

U.S. 284 (1976) eeeeeveeeeee

, 143 U.S.

457 (1892) eeeeeveeveeveee eee

Honea _ vy, Cres

cent Ford

Truck Seles, Inc,, 394

F. Supp. /.)1 (E.D. La.

1975) se , e*eeeeeee#ee#e7e#eee*es

ey, 437 U.S.

678 (1978) eeeeeveeveeeeeeeee

C.A. No. M-83-4134

(D. Md. order dated

Aug. 3, 1984) se ee7neenee#e#eee#ee

, 495

F. Supp. 926 (N.D. Cal.

1979) eeeseeseieoeeeeeeeeneeneneeeeee

Lidde]]_v., Board of

Education, 491 F. Supp.

351 (E.D. Mo. 1980),

aff'd, 667 F.2d 643

(8th Cir. 1981), cert,

denied sub nom,

Caldwell] _v. Missouri,

454 U.S. 1081, 1091

[ae eesaeceueudaesececoee

5,6

. ’ 623

F.2d 1338 (9th Cir. 1980),

cert, denied sub nom,

Schoo] Dist., 450 U.S.

912 (1981) eeeeeeeeeeeeeeee

Mid-Hudson Lega] Services vy.

G, & U,, Inc,, 465

F. Supp. 261 (S.D.N.Y.

1978) eeeneeeeeneeneeeeeeeeeeee

Norwich, 433 F. Supp.

1369 (N.D.N.Y. 1977) eeeeee

Parents Without Partne

X.—BOABLDGA, C.A. No.

JH-83-4314 (D. Md.

consent decree dated

Jan. ll, 1984) ee -v@eeeeeee#es

Patsy v. Florida Board of

Regents, 457 U.S. 496

(1982) eeeesoeeeeesee*#esee#e*e###e#e7#eesee#eee#ee#es

Perkins vy. New Orleans

, 429

F. Supp. 661 (E.D. La.

1976) eeeeeeeeeeeeeeeeeeeee

, 699

F.2d 401 (7th Cir.

1983) e*eeseeoeeeeeeeeeeeeeeeenee

Co., 557 F.2d 1015

(3rd Cir. 1977) eeeeeeenes#e:

5,6

37 ,38,43-

44,47-48

Roadway Express, Inc, vy. Civil Rights Attorney's

Piper, 447 U.S. 752 Fees Awards Act of 1976,

(1980) eeeeeveeveeeeve eee eeeee 14 42 U.S.C. (Supp. Vv)

§ 1988 eeeeoeeeeeeeneeeeneeneeee passim

103 S. Ct. 3274 (1983) .... 31 Clayton Antitrust Act,

15 SS. Ge § 72 eeee<eee74us8ee#e#ee#es 17

j , 435 Clean Air Act, 42 U.S.C.

- Supp. 136 (E.D. iS 7607(£) eeeeeeneeneenteeee8ee8e 2,30

Pa. 1977) e*eeseoeoeeseeneeeeseesesee#es#es¢ 5,6

Clean Air Act Amendments of

i , 452 1977, 42 U.S.C. Supp. V

F. Supp. 1254 (D. Colo. S§ 7413(b), 7604({d),

1978) eeeeeeeveeveeeeeee ee eee 21 7622 (b) (2) (B) @eoeeaoeoeeedeee2e0 2

Sibbach vy. Wilson & Co,, Copyright Act of 1909, 17

eee Perr U.S.C. § 40, now

codified at 17 U.S.C.

§ 505 *eeeseoeeeeneeneenseeeneeeneeee 17

Weber, 443 U.S. 193

FREED kbcbaddeohecesccecese BS Endangered Species Act of

1973, 16 U.S.C.

Waters vy. Heublein, Inc,, § 1540 (g) (4) eeoeeeeeeeeeees 2,30

485 F. Supp. 110 :

Sts Gia BOUND eccccccsss @ Federal Water Pollution

Control Act, 33 U.S.C.

’ 451 U.S. § 1365(d) eeeeeeeeeeeeeeees 2

259 (1981) eeee*eeeegs4858re#ee#ee#e*ee#ee#e#e#e 34

Freedom of Information Act,

5 U.S.C. § 552(a) (4) (E)

CONSTITUTION AND STATUTES: ANG (F) secesececsceeeeceee 2

U.S. Const. Amend. XI ........ 25,27 Interstate Commerce Act of

1887, 49 U.S.C. §§ 8, 16,

Civil Rights Act of 1964, 908(b) and (€) cecccccscees 17

Title VII, 42 U.S.C.

§ 2000 e-5 (k) ceceeeeeeeereeeee 2

xil xiii

Magnuson-Moss Warranty - H.R. 5757, 98th Cong.,

Federal Trade Commission 2d Sess. (1984) eeoeeeeeeees 40

Improvement Act, 15

U.S.C. § 2310 (d) eeeeeeveeesr 28 S. Rep. No. 91-1196, 9list

Cong., 2d Sess. (1970) .... 30

Outer Continental Shelf

Lands Act Amendments of S. Rep. No. 94-1011, 94th

1978, 43 U.S.C. (Supp. V) Cong., 2d Sess.,

SB BSSRCED IE) cccccccecesece 30 reprinted in 1976 U.S.

Code Cong. & Ad. News

Resource Conservation and 5908 eeeeeeeeeeeeeeeeeeeeee 4,24-26

Recovery Act of 1976, 42

U.S.C. (& Supp. V) H.R. Rep. No. 462, 63d

S& GETA(E) cocccccesecccesee 2 Cong., 2d Sess. 16

(1914) eeeeeoeeeeeeeeeeeeeenee 20

Rules Enabling Act

28 0.8.Ge : 2072 eeeeeeeeee 20 H.R. Rep. No. 94-1558, 94th

Cong., 2d Sess. (1976) .... 24-26

Surface Mining Control and

Reclamation Act of 1977, Reforms in Judicial Proce-

SS Ge. © BETOEED cécccee 2 dure, American Bar

Association Bills,

Fee ee fo errr | Hearings Before the House

Judiciary Committee,

42 Sm. Go § 1983 eeeeeee#eee#ee#ee#es#es passim 63d Cong., 2d Sess. 22

(1914) eeeseeoeeeeeseeenseseeeeeeeneeee 20

S. 141, 98th Cong., lst on S, 584, S,. 585, and

Sess., 129 Cong. Rec. S..990 Before the Sub-

S636 (daily ed. Jan. 26, committee on the

1983) e*eeeee#e4#ensee@*eeeee@*ee#ee#ee#ee#ee#ee#e#e¢ 39-40 Constitution of the

S. 2802, 98th Cong., 2d 97th Cong., lst Sess.

Sess., 130 Cong. Rec. (Comm. Print 1981) eeeeeeee 39-47

S8498-8500 (daily ed.

June 27, 1984) eeeseeoeseeeneeeee 40

XiV XV

Attorney's Fees Awards: Advisory Committee Proposal

Hearings on S. 585 (and for Amendments to the

on Amendments to be Federal Rules of Civil

Proposed by Senator Procedure, 98 F.R.D. 337

Orrin G. Hatch) Before (1983) eeeeeeeeeeeeeeeeeeee 52

the Subcommittee on the

Judiciary, 97th Cong.,

2d Sess. (Comm. Print PERIODICALS:

1982) eeceeeeeeeeeeeeeeeeees 38-47

Burbank,

, 130 U. Pa.

RULES: L. Rev. 1015 (1982) .....+-- 20

Federal Rules of Civil

Procedure: MISCELLANEOUS:

Sele F citveceseosstcess ABA Model Rules of

Professional Conduct,

ce i Bale. ae Rule 1.2(a) weccceeseeeeees 57-58

Behe BD ceccccdecceveses 36,38 Committee on Professional

and Judicial Ethics

BERS AD cccccccccccccces 36,35 of the New York City

Bar Association, Op.

DULG 26 scccccccccccccee 36538 No, 80-94, 36 Record

of the N.Y.C.A.B.A.

Rule 30 seeueeeeeeeeseees 14 507 (1981) eeeeeeeeeeeeeeee 57

Rule 37 eeeeseeeeeeeeeeeee 14 Letter from D. Lowell

Jenson, Acting Deputy

Bale SE ccoccccccccccecee 43 Attorney General, to

_ the Honorable Edward T.

RULE SE cccccceccccccccee 16,38 Gignoux, Chair,

Committee on Rules of

Rule 68 wcsseceeeeceeess passim Practice and Procedure

(Feb. 28, 1984) eeeeeeeeeeee 51

Letter from the Honorable

James McGirr Kelly to

the Committee on Rules

of Practice and Procedure

(Dec. 14, 1983) weceeeeeeees 60

IN THE

SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1984

ee ee ee ee ee ee eee ee ee ee

——_—— ee a

No. 83-1437

JEFFREY MAREK, THOMAS WADYCKI

AND LAWRENCE RHODE,

Petitioners,

Vv.

ALFRED W. CHESNY,

Respondent.

—— OT ee oe oe - EEO OE Oe Se

ON WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

le Mr ly i i tl i i

BRIEF OF THE ALLIANCE FOR JUSTICE

AS AMICUS CURIAE ON BEHALF OF ITS

MEMBERS SUPPORTING RESPONDENT

oe = ee ee ee

INTEREST OF AMICUS CURIAE

The Alliance for Justice is a

national association of public interest

legal organizations. Its members, who

join in the filing of this amicus

brief,2/ are typical of the public

interest law firms that litigate under

the Civil Rights Attorney's Fee Awards

Act of 1976 (42 U.S.C. § 1988), and under

other fee-shifting statutes that may be

affected by the Court's decision in this

case. @/

1/ Members of the Alliance for Justice are

listed on the inside of the front cover of this

brief.

2/ Members of the Alliance also litigate under

a number of other statutes with fee-shifting

provisions that may be affected by the Court's

ruling in this case. These statutes include,

inter alia: the Civil Rights Act of 1964, Title

VII, 42 U.S.C. § 2000e-5(k); the Clean Air Act,

42 U.S.C. § 7607(f£); the Clean Air Act Amendments

of 1977, 42 U.S.C.(Supp. V) §§ 7413(b), 7604(d);

the Federal Water Pollution Control Act, 33

U.S.C. § 1365(d); the Endangered Species Act of

1973, 16 U.S.C. § 1540(g)(4); the Freedom of

Information Act, 5 U.S.C. § 552(a)(4)(E) and (F);

the Resource Conservation and Recovery Act of

1976, 42 U.S.C. (& Supp. V) § 6972(e); and the

Surface Mining Control and Reclamation Act of

1977, 30 U.S.C. § 1270(¢c).

One of the Alliance's foremost

purposes is to ensure access to the

judicial process for those who have

historically lacked the resources to

obtain lawyers to assert their rights,

including Black and Native Americans,

poor persons, consumers, women, children,

and persons institutionalized in mental

health facilities. Hence, the persons

served by Alliance for Justice members

are representative of the persons whom

Congress sought to afford access to the

courts through laws such as Section 1988.

A number of these persons, with the

assistance of public interest lawyers,

are litigating as "private attorneys

general” to advance congressional

policies and to protect constitutional

rights in cases covered by Section 1988

and other fee-shifting laws.2/ These

sivil rights cases include, for example,

challenges to discrimination in public

housing4/ and segregation in public

schools. 2/ Alliance members have also

3/ The Senate Report accompanying Section 1988

even cites a Title VII case litigated by an

Alliance member (the Center for Law in the Public

Interest) as an example of a case where the

standard for fee awards was properly applied in

order "to attract competent counsel" to civil

rights cases. See S. Rep. No. 94-1011, 94th

Cong., 2d Sess. 6, reprinted in 1976 U.S. Code

& Ad. News 5908, 5913 (citing D Davis v. County of

Los Angeles, 8 E.P.D. 4 9444 (C.D. Cal. 1974)).

4/ See, e.g., Hills v. Gautreaux, 425 U.S. 284

(1976) (holding metropolitan areawide relief

permissible in case of deliberate racial discri-

mination in housing).

5/ See, e.g., Columbus Board of Education v.

Penick, 443 U.S. 449 (1979) (holding systemwide

school desegregation remedy proper on the basis

of the lower court's findings and conclusions

as to unconstitutional, racially segregative

purpose and impact of school board's conduct);

Liddell v. Board of Education, 491 F. Supp. 351

(E.D. Mo. 1980), aff'd, 667 F.2d 643 (8th Cir.

1981), cert. denied sub nom. Caldwell v. Missouri,

454 U.S. 1081, 1091 (1981) (holding St. Louis

Board of Education and State of Missouri liable

for the establishment and maintenance of a

racially segregated public school system within

St. Louis).

been litigating significant cases on

behalf of consumers,®/ parents seeking to

enforce child support orders, 1/

juveniles, 8/ and Black schoolchildren

6/ See, e.g., Consumers Union v. Virginia State

Bar, C.A. No. 75-0105-R (E.D. Va. 1975) (settled

after suing for right to provide information

about law firms in a legal directory without

being subject to disciplinary action).

7/ See, e.g., Jenkins v. Massinga, No. M-83-4134

(D. Md. order dated Aug. 3, 1984) (protecting

custodial parents’ and childrens' right to

receive full proceeds from child support awards,

without illegal deductions); see also Parents

Without Partners v. Massinga, C A. No. JH-83-4314

(D. Md. consent decree date’ Jan. 11, 1984)

(state defendants ayrced to provide child support

enforcement services co all eligible parents in

compliance with federal law).

8/ See, e.g., Coleman v. Stanziani, 570 F. Supp.

679 (E.D. Pa. 1983) (holding that plaintiffs

challenging constitutionality of Pennsylvania juve-

nile pretrial detention statutes were not required

to exhaust state remedies), appeal dismissed, 735

F.2d 118 (3d Cir. 1984); Cameron v. Montgomery

County Child Welfare Service, 471 F. Supp. 761

(E.D. Pa. 1979) (denying summary judgment where

"deprived" child alleged failure to provide him

with adequate care, treatment, and services which

would have enabled him to return home) (case later

settled); Santiago v. City of Philadelphia, 435

F. Supp. 136 (E.D. Pa. 1977) (denying in part

motion to dismiss complaint that conditions and

treatment of Youth Study Center deprived juveniles

of constitutional rights) (case later settled).

challenging the use of standardized IQ

tests to place them in programs for

mentally retarded students. 2/

Often, Alliance members have been

able to enforce their clients'

constitutional or statutory rights

through a negotiated settlement of

litigation. 10/ However, some cases have

proven difficult to conclude through

settlement, for a wide variety of

reasons. In some of the cases litigated

by Alliance members, for example,

judicial resolution of an unsettled

9/ See, e.g., Larry P. v. Riles, 495 F. Supp. 926

(N.D. Cal. 1979).

10/ Settlements were achieved, for example, in

Parents Without Partners v. Massinga, C.A. No.

JH-83-4314 (D. Md. 1984); Cameron v. Montgomery

County Child Welfare | Service, 471 F. Supp. 761

(E.D. Pa. 1979); Sar Santiago v. City of Philadelphia,

435 F. Supp. 136 (£.D. Pa. 1977); and ‘Consumers

Union v. Virginia State Bar, C.A. No. 75-0105-R

(E.D. Va. 1975).

question of law has been an important

precondition to settlement ..1/

The availability of attorney's fees

under statutes such as Section 1988 has

improved the ability of Alliance members

to secure legal services for otherwise

unrepresented segments of the public.

The statutory fee awarcs that these

nonprofit organizations receive are

channeled directly into continuing and

when possible expanding the legal repre-

sentation they offer. Furthermore, the

availability of fees may make it easier

for these groups to refer cases to other

attorneys, including private counsel,

when their own limited resources are

insufficient. Members of the Alliance

thus have a strong interest in the appli-

cation of Section 1988, since the Court's

1l/ See, e.g., Hills v. Gautreaux, 425 U.S. 284

(1976) (settled following the Supreme Court's

determination of whether and to what extent area-

wide relief should be available to remedy

deliberate racial discrimination in housing).

interpretation of the statute may well

affect their ability to ensure represen-

tation for those citizens who need it.12/

For these reasons, the Alliance will

address the first issue that is before

the Court: Whether Rule 68 of the Federal

Rules of Civil Procedure should be

interpreted as requiring an attorney's

fee sanction against a prevailing civil

rights plaintiff who has refused a

settlement offer. The Alliance respect-

fully submits that this issue was

correctly decided by the Court of Appeals

for the Seventh Circuit when it deter-

mined that Rule 68 and Section 1988 do

not provide for such an attorney's fee

sanction.

a —_

12/ It is important to note, however, that fee

awards do not subsidize these organizations. For

the majority of Alliance members, fee awards conm-

prised only one to twelve percent of the

organization's 1983 budget.

SUMMARY OF ARGUMENT

Petitioners (and their supporting

amici) are urging the Court to adopt a

judicial construction of Rule 68 of the

Federal Rules of Civil Procedure that

will effectively rewrite the Civil Rights

Attorney's Fee Awards Act of 1976 (and

ninety-one other acts of Congress that

the Solicitor General asserts have

Similar wording). However, neither

members of Congress, nor the drafters of

the Federal Rules, intended this result.

Rather, they intended the term “costs” in

Rule 68 to have its traditional meaning,

and not to include attorney's fees.

Neither Congress nor the Advisory

Committee intended to abrogate this

traditional distinction between fees and

costs in 1938, or in the forty-six years

Since the Federal Rules were submitted

for Congressional approval. The language

in the 1976 Fees Act which refers to

attorney's fees "as part of costs" is not

intended to abrogate that distinction;

rather it is intended to enable federal

Gistrict judges to award attorney's fees

against state officials notwithstanding

the Eleventh Amendment's bar of retro-

active relief in the form of damages.

Moreover, the interpretation of Rule

68 that petitioners urge the Court to

adopt would be highly inconsistent with

Congressional purposes in enacting the

Civil Rights Attorney's Fee Awards Act,

and would create serious legal, practi-

cal, and policy problems as applied to

both the 1976 Fees Act and to other

fee-shifting statutes.

The petitioners’ request for such

substantial modifications in the Federal

Rules and the 1976 Fees Act should be

addressed to Congress, not to the Court.

Congress has the institutional competence

to weish competing points of view and

determine whether amendments are war-

ranted, and if so, what their design and

scope should be.

In fact, Congress is already

considering a request quite similar to

the one advanced by petitioners here.

This request to amend Section 1988 has

generated considerable controversy.

During 1981 and 1982 hearings on the

proposal, witnesses varied widely on

whether and to what extent such an

amendment was needed, what its impact

might be, and what form it might take.

None of the witnesses, however, sug-

gested, as do the petitioners here, that

Rule 68, or the 1976 Fees Act, already

provided for such an attorney's fee

sanction.

Finally, there is no need for the

Court to fashion a procedural tool of the

type petitioners seek. There has been no

demonstration that existing incentives

are inadequate to produce fair settle-

ments in appropriate cases. Furthermcre,

Sanctions are already available under

existing case law and statutory provi-

Sions for situations in which attorneys

litigate in bad faith under fee-shifting

Statutes, refuse to entertain settlement

offers in good faith, os multiply Or

prolong litigation unreasonably and

vexatiously.

ARGUMENT

I. THE TERM "COSTS" IN RULE 68 DOES

NOT INCLUDE ATTORNEY'S PEES,

A. The Drafters and Revisers of

the Federal Rules of Civil

Procedure Have Retained the

Traditional Distinction

Between Fees and Costs, _

There has always been a sharp dis-

tinction between costs and attorney's

fees under traditional principles of

American law. Costs are generally

awarded to the prevailing party unless

the court directs otherwise; however,

each party bears his or her own

attorney's fees unless there is an

explicit statutory provision to the

contrary. Alyeska Pipeline Service Co,

vy. Wilderness Society, 421 U.S. 240

(1975). Also under traditional prin-

ciples, although costs are shifted as a

matter of course at the close of the

litigation, attorney's fees can only be

shifted pursuant to defined criteria and

are not shifted automatically.

Both the original Advisory Committee

that drafted the Federal Rules of Civil

Procedure (in 1935 to 1938) and subse-

quent Advisory Committees revising the

rules have retained the traditional

distinction between costs and attorney's

fees. Where the rules are intended to

refer to costs, as in Rule 54, the term

"costs" is used. Where the rules are

intended to refer to attorney's fees, the

term “attorney's fees" or “expenses,

including attorney's fees" is used. See

Rules ll, 16(f£), and 26(g) (as amended in

1983); and Rules 30(g), 37, and 56(g) .13/

This distinction is reinforced by

the fact where attorney's fee sanctions

(as opposed to cost assessments) are

included in the Federal Rules, the

Advisory Committee has often made express

reference to that fact, and discussed the

reasons for the fee sanction in a

Committee Note. See, ¢€,g,, Advisory

Committee Notes (1983 Amendment) to Rules

ll, 16(f£), and 26(g). Additionally,

where the drafters of the Federal Rules

13/ The decisions of this Court in Delta Air-

lines, Inc. v. August, 450 U.S. 346 (1981), and

Roadway Express, Inc. v. Piper, 447 U.S. 752

(1980), recognize the distinction in the Federa!

Rules between costs and attorney's fees. These

decisions are discussed in detail in the Amicus

Brief of the Association of the Bar of the City

of New York (Supporting Respondent) at 9-16; that

discussion will not be duplicated here.

have included an attorney's fee sanction

in the rules, they have provided a pre-

cise description of the type of conduct

or the degree of culpability necessary to

invoke the sanction; none of the Federal

Rules include the type of automatic,

mandatory fee sanction that petitioners

urge here. See, €,9,, Rules 7, 8, and

ll, and Advisory Committee Notes (1983

Amendment) to Rule 1l; Rule 16(f); Rule

26(f) and (g), and Advisory Committee

Note (1983 Amendment); and Rule 56(g).

Moreover, nowhere in the 1938

version of the Federal Rules of Civil

Procedure, the accompanying Advisory

Committee Notes, subsequent amendments to

the rules or accompanying Committee

Notes, is there any reference to the

question of whether or not certain

Statutes “define attorney's fees as part

of costs" (Petitioners' Brief at ll,

18-19), or any reference to the signifi-

cance of such statutory language in

interpreting and applying the Federal

Rules. There is, in other words, no

historic evidence that the drafters of

the Federal Rules were aware of or

intended the potential interpretation

urged in this case. On the other hand,

there is evidence that to the limited

extent drafters of the first set of

Pederal Rules intended to recognize and

incorporate statutory provisions relating

to costs they did so explicitly. See

Advisory Committee Note accompanying Rule

54. No such reference accompanies Rule

68, and this Court should be reluctant to

imply that one was intended.

B. Congress, In Its 1938 Approval

of the Federal Rules of Civil

Procedure, Did Not Amend,

Sub Silentio, Existing Fee-

Shifting Statutes, _

Nor should the Court assume that

Congress, simply by its approval in 1938

of the first set of the Federal Rules of

Civil Procedure (including Rule 68)

intended to modify the fee-shifting

statutes it had already enacted, such as

the Clayton Antitrust Act (15 U.S.C.

§ 15), the Interstate Commerce Act of

1887 (49 U.S.C. §§ 8, 16, 908(b) and

(e)), or the Copyright Act of 1909 (17

U.S.C. § 40, now codified at 17 U.S.C.

§ 505), inter alia. As noted above,

there is no evidence in either the rules

or the legislative materials relevant to

their approval to indicate that the

Advisory Committee or the Court were

recommending such a sub silentio

amendment of existing statutes, notwith-

Standing the Solicitor General's

contentions that such an implied modifi-

cation of existing statutes must have

been intended. Brief of Solicitor

General at 12-14.

Nor, for that matter, can one assume

that members of Congress even considered

the possibility of such a gub silentio

amendment of existing fee allocation

Statutes when they approved the first set

of rules in 1938. As Justice Frankfurter

pointed out in his dissent in Sibbach y,

Wilson & Co,, Inc,:

-e- [L] ittle significance

attaches to the fact that [in

1938] the Rules, in accordance

with the statute, remained on the

table of two Houses of Congress

«+. and thereby automatically

came into force. Plainly the

Rules are not acts of Congress

and can not be treated as such.

Having due regard to the

mechanics of legislation and the

practical conditions surrounding

the business of Congress when the

Rules were submitted, to draw any

non-action by Congress is to

appeal to unreality.

312 U.S. 1, 18 (1940) (emphasis added).

Justice Frankfurter's observations apply

with even greater force in the instant

case, where the interpretation that

petitioners urge Congress “must have

intended” could not have been inferred by

the legislators from a reading of the

rules, but would have required them to

also make detailed reference to the exact

language of all fee allocation statutes

enacted prior to 1938.

Moreover, even if members of

Congress had considered the possibility

in 1938 that Rule 68 would amend, gub

Silentio, some existing fee allocation

statutes, they would not have approved

it. Both proponents of the kules

Enabling Act and membere of Congress had,

just a few years earlier, articulated

Clear limits on the rulemaking powers

that the Court would be granted: That

power would not include the authority to

“abridge, enlarge, or modify any substan-

tive right." 28 U.S.C. § 2072. As

Thomas Shelton, the Chair of the ABA

Committee on Uniform Judicial Procedure,

had explained at hearings on the Rules

Enabling Act: "[T])he Supreme Court is

not going to hold that it has the power

to legislate, and it will confine itself

to regulating the detail machinery of the

trial courts." Reforms in Judicial]

: —_ ,; : Lati

7. ; Bef the #

Judiciary Committee, 63rd Cong., 2nd

Sess. 22 (1914); gee also H.R. Rep. No.

462, 63d Cong., 2d Sess. 16 (1914) ("the

rules will not have the effect or dignity

of statutes") .14/

In light of these factors, it is

perhaps not surprising that in the first

thirty-seven years following the adoption

of the Federal Rules of Civil Procedure

there is only one reported case in which

a litigant made an argument analogous to

the argument advanced by petitioners

here. In that case, Gamlen Chemical Co,

vy. Dacar Chemica] Products, 5 F.R.D. 215,

216 (W.D. Pa. 1946), the court rejected

the plaintiff's contention that the

phrase “with costs then accrued" in Rule

68 had to be read as referring to

attorney's fees because the substantive

statute provided for an award of

attorney's fees "as part of costs. "L2/

15/ Im more recent years courts have split on the

issue presented in Gamlen Chemical Co., in some

cases opining that the Rule 68 phrase does not

include attorney's fees (Piquead v. McLaren, 699

F.2d 401 (7th Cir. 1983); Greenwood v. Stevenson,

88 F.R.D. 225 (D.R.1I. 1980) (dicta)), and in other

cases that it does (Fulps v. City of Springfield,

715 F.2d 1088 (6th Cir. 1983); Waters v. Heublein,

Inc., 485 F. Supp. 110 (N.D. Cal. 1979); Scheriff

v. Beck, 452 F. Supp. 1254 (D. Colo. 1978)

(dicta)).

It wes not until 1982, in the

Gistrict court proceedings in this case,

that a litigant first advanced the

attorney's fee sanction argument made

here. 16/ However, as explained below,

Congress did not intend either the Civil

Rights Attorney's Fee Awards Act of 1976

or other fee-shifting laws to be given

the interpretation petitioners urge.

C. Nor Did Congress, in Enacting

the Civil Rights Attorney's

Fees Act of 1976, Abrogate

the Distinction in the

Federal Rules Between Fees

and Costs,

The petitioners and the Solicitor

EES re EE ee ee

General have attempted to argue that when

16/ But cf. Perkins v. _ New Orleans Athletic Club,

_—_—_ --_—- --——- -——— —- —

429 F. ‘Supp. 661 (E.D. La. 1976) (court makes

a similar suggestion, in dicta); Honea v. Crescent

—_—-— —- ——— -+

1975) (same); see “also Bitsouni v. Sheraton

Hartford Corp., 33 F.E.P. Cases 898 (D. Conn.

1983) (same argument asserted successfully by

defendant).

MN a

Congress enacted the Civil Rights

Attorney's Fee Act of 1976, it implicitly

adopted an attorney's fee cutoff for

refusing a settlement offer (under Rule

68) because it chose language referring

to attorney's fees as part of costs.

Petitioners’ Brief at 18-19; Solicitor

General's Brief at 6-8. However, they

have not cited and can not cite any

historical evidence or pertinent portions

of the legislative history to support

their argument.

The legislative history of the 1976

Act, important in the consideration of

this case, is discussed in detail in the

Respondent's Brief, and in the Amicus

Briefs of the Lawyers’ Committee for

Civil Rights Under Law and the NAACP

Legal Defense and Education Fund, Inc.

(in Respondent's Support). That detailed

discussion will not be repeated here.

Suffice it to say that several issues

Surrounding the settlement of civil

rights litigation were considered during

legislative deliberations. See S. Rep.

No. 94-1011, 94th Cong., 2d Sess. 5,

reprinted in 1976 U.S. Code Cong. & Ad.

News 5908, 5912 [hereinafter cited as

Senate Report]; H.R. Rep. No. 94-1558,

94th Cong., 2d Sess. 7 (1976) [herein-

after cited as House Report]. However,

there was no consideration of either Rule

68 or any other provision in the Federal

Rules of Civil Procedure, and no sugges-

tion that attorney's fees should be

reduced or limited if a civil rights

plaintiff rejected a settlement offer.

Moreover, the legislative history of the

Act contains a detailed, comprehensive

explication of the factors for a court to

consider in setting a fee award (gee,

@.9,., Senate Report at 6), and nowhere in

that discussion is there any reference to

either Rule 68, or any other Federal

Rule, or to any possibility qf reducing

attorney's fees if a client rejects a

settlement offer.

The only basis for the petitioner's

(and the Solicitor General's) assertion

that Congress intended to adopt a fee

cutoff is the legislators' choice of the

following words: "[T]he court, in its

discretion, may allow the prevailing

party, other than the United States, a

reasonable attorney's fee as part of the

costs." 42 U.S.C. § 1988. However,

there are references in the legislative

history explaining why Congress chose

this particular terminology. Congress

sought, as this Court recognized in Hutto

vy. Finney, 437 U.S. 678 (1978), to enable

federal district judges to award attor-

ney's fees against state officials

notwithstanding the Eleventh Amendment's

bar of retroactive relief in the form of

damages. Jd.; see also Senate Report at

5; House Report at 7.22/

Contrary to the assertions of the

Solicitor General, the fact that Congress

chose this terminology to abrogate

Eleventh Amendment immunity does not

imply that it chose simultaneously to

incorporate the mechanical provisions of

an obscure Federal Rule of Civil Proce-

dure. Rather, it suggests simply that

Congress chose this terminology for a

Single, limited purpose, and that the

words of the statute are not meaningless

Or superfluous (as the Solicitor General

tries to suggest, Brief at 9) or to be

given a different reading from the one

Congress intended. As the Fifth Circuit

explained in Gates vy, Cojlier, in

17/ Historically, an award of attorney's fees

had often been considered an element of damages,

not an element of costs. See Alyeska Pipeline

Service Co. v. Wilderness Society, 421 U.S. 240,

249 n.21 (1975); see also Chesny v. Marek, 7270

F.2d 474, 479 (7th Cir. 1983), cert. granted, 104

S. Ct. 2149 (1984).

weishing analogous arguments that since

Congress “defined attorney's fees as part

of costs" plaintiffs should be able to

recover interest on their fee award:

[W]hile it is true that

§ 1988 also defines attorneys’

fees as part of costs, see note

9, supra, the legislative his-

tory makes clear that this was

Gone for one reason and one

reason only: to ensure that the

Eleventh Amendment is no bar so

that these fees are recoverable

against Government officials

acting in their official capa-

city.

616 F.2d 1268, 1276 (Sth Cir. 1980),

reh'g granted, 636 F.2d 942 (1981).

Hence, there is no legislative support

for the interpretation petitioners urge.

D. Nor Has Congress Abrogated

the Rules' Distinction

Between Fees and Costs by

Enacting Other Fee-Shifting

Statutes in Recent Years,

The fact that Congress has used

similar language referring to attorney's

fees as part cf costs in some of the

other fee-shifting statutes enacted in

the years since 1938 does not, by

implication, abrogate the traditional

distinction between fees and costs

adhered to in the Federal Rules. Rather,

it illustrates some of the difficulties

inherent in adopting petitioners’

position.

The Solicitor General asserts,

albeit with a margin of error,48/ that

seventy-two of the one hundred sixteen

18/ The Solicitor General errs in characterizing

certain of the statutes in Part I of his Appendix

as "Statutes Awarding Attorneys’ Fees as Part of

Costs." Some of the statutes listed in Part I are

in fact worded to refer to "costs and expenses

(including attorney's fees)," (emphasis added).

See, e.g., Magnuson-Moss Warranty - Federal Trade

Commission Improvement Act, 15 U.S.C. § 2310(d).

Statutory language of this type suggests, contrary

to the argument advanced by the Solicitor General,

that fees are not considered as part of costs, but

rather as part of a separate item referred to as

“expenses,” in the same terminology used frequently

in the Federal Rules of Civil Procedure. See

discussion of terminology used in the Federal

Rules at pages 12-16, above.

federal fee-shifting statutes enacted

since 1938 contain language similar to

that used in Section 1988. Brief of

Solicitor General, Appendix, at la-9a.

Hence, if the arguments advanced by

the petitioners and the Solicitor General

are correct, then numerous other fee-

shifting statutes will have to be

construed as mandating sizeable attor-

ney's fee sanctions for rejecting a Rule

68 offer of judgment. In fact, this

seems to be the result that the Solicitor

General seeks. However, there is no

legislative history or historical

evidence indicating that Congress

intended such a result when it enactea

these statutes. The legislative

materials that do exist suggest that the

interpretation urged by petitioners and

the Solicitor General woulc be

inconsistent with the fee allocation

mechanisms and the statutory objectives

of many of these laws.

For example, such an interpretation

would undermine the incentives for

enforcement litigation that Congress

intended when it enacted fee-shifting

provisions as part of a number of envi-

ronmental protection laws. See, ¢€,g,,

Clean Air Act (42 U.S.C. § 7607(£));

Endangered Species Act of 1973 (16

U.S.C.A. § 1540(g)(4))? and Outer

Continental Shelf Lands Act Amendments of

1978 (43 U.S.C. (Supp. V) § 1349(a)(5)).

Provisions of this type were designed to

encourage citizens to bring enforcement

lawsuits and thereby perform a public

service. See, €,.9., Senate Report on the

Clean Air Act, S. Rep. No. 91-1196, 91st

Cong., 2d Sess. 38 (1970).

But those incentives would be

destroyed by an interpretation of the

type urged here by the petitioners and

the Solicitor General, in this way: The

fee allocation sections of these

environmental statutes contain

terminology (similar to that in Section

1988) referring to fees as part of costs.

However, unlike the wording of Section

1988, the language of these laws which

allowe for a discretionary award of fees

to a party does not include an express

requirement that the party requesting

fees prevail in the lawsuit.12/ thus, if

the requirements of Rule 68 are "read

together” with the language of these

environmental laws, in a manner analogous

to that urged in the instant case, the

result may be that an environmental

19/ But see Ruckelshaus v. Sierra Club, 103

fee awards to be reserved for successful plain-

tiffs).

of the litigation. This is hardly the

type of result that Congress contemplated

when it drafted the fee-shifting

provisions in these environmental

statutes.

E. "Plain Meaning” Tenets of

Statutory Construction Do

Not Compel a Reading of

Attorney's Fees as Part of

Costs Under the Federal

Rules. . ainda

Petitioners and the Solicitor

General repeatedly contend that when

Section 1988 and other fee-shifting

statutes are interpreted in accordance

with their “plain meaning” the result

must be the imposition of an attorney's

fee sanction under Rule 68. Petitioners’

Brief at 11; Solicitor General's Brief at

3-4, 9-10. However, there are two

central fallacies in this assertion.

First, by their apparent reliance

upon the "plain meaning" of brief

excerpts from the statutory language,

petitioners and the Solicitor General

fail to recognize the importance of the

overall statutory scheme and the

legislative history of each of the

fee-shifting statutes. As this Court has

often recognized, a particular

interpretation may appear to be within

the letter of a statute, and yet not be

correct because it is not within the

Spirit of the statute or the intention of

its makers. See United Steelworkers vy.

Weber, 443 U.S. 193, 201 (1979), guoting

Holy Trinity Church vy, United States, 143

U.S. 457, 459 (1892). Careful review of

legislative materials and the purposes

and policies reflected in them has long

been the hallmark of this Court's

Statutory analysis. See, ¢,g,, Watt v.

Alaska, 451 U.S. 259, 266 (1981); Boston

Sand & Grave] Co, v, United States, 278

U.S. 41, 47-48 (1928). Conclusory

references to abbreviated excerpts from

Statutory language, of the type urged by

the Solicitor General here, should not be

substituted for a thorough review of

Congressional enactments and policies.

Second, petitioners and the

Solicitor General err in contending that

tenets of statutory construction compel a

reading of attorney's fees as part of

costs under the Federal Rules. The

"plain meaning” principle of statutory

construction, which suggests interpreting

the language of a statute in accordance

with its ordinary meaning and usage, is

based on the assumption that the

legislators were fully aware of the

Ordinary meaning of the words they chose

to employ, and purposeful in their

choice. One cannot assume in the instant

case, however, that members of Congress

in any way intended their use of the word

"costs" in statutory language to be

accorded the particularized meaning it

would have in petiticners'’ Rule 68

interpretation.

There is a "plain meaning" of costs

in the Federal Rules of Civil Procedure,

and it is the traditional definition that

does not include attorney's fees.

Additionally, there are a series of

carefully-~articulated, and varying, fee

mechanisms that Congress has chosen to

encourage enforcement of federal

Statutory policies. Those mechanisms do

not include, in any instance, sanctions

for rejecting a settlement offer.

What petitioners (and the Solicitor

General) seek from this Court is not a

simple "interpretation" of the terms

“costs” and “fees” as used in the Federal

Rules of Civil Procedure and of Section

1988. Clear, unambiguous, and

longstanding interpretations of the terms

used in these contexts already exist.

Rather, petitoners are seeking a judicial

construction that will effectively amend

the Civil Rights Attorney's Fee Act of

1976, and according to the Solicitor

General, ninety-one other Congressional

enactments also. This would be a drastic

step for the Court to take, one that

would raise many additional questions and

problems, and one more appropriately

reserved for legislative consideration.

II. THE ISSUE RAISED IN THIS CASE

IS APPROPRIATE FOR LEGISLATIVE,

NOT JUDICIAL, RESOLUTION,

When, as in this case, there is an

established, longstanding construction of

an existing statute or rule, the

responsibility for rewriting the statute

Or rule lies with Congress, not with the

Court. See, €,.9,, Patsy v,. Florida Board

of Regents, 457 U.S. 496 (1982). The

Court should not reinterpret the statute

or rule in a manner that effectively

amends it, particularly when (as here)

Congress already has the question of

whether such an amendment is advisable

under active consideration.

These principles apply with

particular force in the instant case

because the modification of fee

allocation rules is a Congressional

responsibility. Alyeska Pipeline Service

Co, v. Wilderness Society, 421 U.S. 240

(1975); see also Blum vy. Stenson, 104

S. Ct. 1541 (1984).

Moreover, it is also important to

recognize Congress' superior institu-

tional competence in this instance

because the procedural modifications

urged by petitioners will have a

Significant effect on the assertion of

substantive rights under the Constitution

and federal laws. See Patsy vy. Board of

Regents, 457 U.S. 496.

In fact, the possibility of an

amendment in the 1976 Fees Act to

accomplish precisely the result

petitioners urge here is being

extensively debated in Congress.

Proponents and opponents of the measure

differ sharply on its policy

implications, and about whether or not

there is a need for it. The record of

Congressional consideration and debate

underscores the fact that this matter is

appropriate for legislative rather than

judicial resolution.

Senator Hatch first proposed the

measure during a series of hearings held

in 1981 and 1982 to consider amendments

in Section 1983 and Section 1988. See

Attorney's Fees Awards: Hearings on

S, 585 (and on Amendments to Be Proposed

by Senator Orrin G, Hatch) Before the

Subcommittee on the Constitution of the

Senate Committee on the Judiciary, 97th

Cong., 2d Sess. 12-13 (Comm. Print 1982)

[hereinafter cited as 1982 Hearings] ;

] M . . ] Li Llit U j 42

U.S.C, 1983: 5. 584

S,. 585, and S. 990 Before the

Sul 7 the Constituti ct)

Committee on the Judiciary, 97th Cong.,

lst Sess. (Comm, Print 1981) [hereinafter

cited as 1981 Hearings]. After the

hearings, the 97th Congress took no

further action on the proposal. In the

first session of the 98th Congress,

Senator Hatch included an identical

proposal in S. 141, a bill including both

a "good faith" aefense for municipal

governments sued under Section 1983 and a

number of additional limitations on

attorney's fee awards under Section 1988.

S. 141, 98th Cong., lst Sess., 129 Cong.

Rec. S636 (daily ed. Jan. 26, 1983). No

hearings on the bill were held and no

other action was taken.

Now, in the second session of the

98th Congress, the Administration has

requested a similar fee limitation

proposal as part of an omnibus attorney's

fee bill. H.R. 5757, 98th Cong., 2d

Sess. (1984) ("The Legal Fees Equity

Act"); S. 2802, 98th Cong., 2d Sess., 130

Cong. Rec. S8498-8500 (daily ed. June 27,

1984). Hearings on the Administration

proposal, which may differ slightly from

Senator Hatch's earlier bill in its

design and scope, were just held by the

Subcommittee on the Constitution of the

Senate Committee on the Judiciary on

September ll, 1984.

As mentioned above, the 1981 and

1982 hearings reflected a wide divergence

of opinion on whether there was a need to

increase settlement incentives in civil

rights litigation. Witnesses varied

considerably in their views on whether

and to what extent parties had been able

to reach settlement agreements in civil

rights cases, and as to what factors and

which parties were responsible for the

fact that some cases were not settled.

Several city attorneys responsible for

defending Section 1983 actions claimed

that plaintiffs' attorneys sometimes

prolonged litigation in order to increase

their fee entitlement (1981 Hearings,

Supra p. 39, at 290, 500, 502-03; 1982

Hearings, gupra p. 38, at 7, 90-91, 109),

but they gave no specific examples of

cases in which plaintiffs rejected

reasonable settlement offers.

Other witnesses pointed out that for

plaintiffs and their counsel the

possibilities of losing a case

altogether, failing to recover either

damages or attorney's fees, and facing

potential liability for costs already

furnished substantial disincentives for

refusing a reasonable settlement offer.

198] Hearings, supra p. 39, at 614-15,

619-20; 1982 Hearings, gupra p. 38, at

20, 50-51. In some cases, witnesses

reported, government defense attorneys

were responsible for prolonging

litigation by refusing reasonable

settlement offers.22/ In general, the

20/ Fletcher Farrington, a private practitioner

from Georgia, described a case in which a nearby

county, against the advice of its lawyers, refused

a plaintiff's offer to settle for $8,000. The

case went to trial, and the jury returned a ver-

dict of $74,000. 1982 Hearings, supra p. 38

at 44, 48.

Stephen Ralston of the NAACP Legal Defense

Fund described a major case against Georgia State

Prison officials which continued for seven years

and took twenty weeks to try. Finally, after the

trial, because of encouragement from the judge,

incidents at the prison, and a change in defense

counsel, the State agreed to settle the case on

basically the same terms that the plaintiffs had

offered before the case went to trial. 1981

Hearings, supra p. 39, at 612-13.

legislative record on these settlement

issues, as on a number of other

attorney's fee issues, was far from

conclusive. Both Senator Hatch (who

Chaired the Hearings) and suka

Congressman Drinan (who had served as

floor manager for the 1976 Fees Act)

commented on the need for fuller

documentation of the prcohlems alleged.

1981 Hearings, supra p. 39, at 326; 1982

Hearings, supra p. 38, at 72-73.

The fact that, as recently as 1982,

members of Congress did not believe they

had a sufficient record to address this

policy dispute bespeaks the need for

legislative deliberation on the matter.

As the Court explained in Patsy y,

Plorida Board of Regents, 457 U.S. at

513-15, when it rejected a request that

it reinterpret Section 1983 te require

exhaustion of state administrative

remedies, the policy issues inherent in

such requests are best addressed by

Congress. In language that might well

apply also in the instant case, the Court

cautioned that:

[T]he relevant policy considera-

tions do not invariably point in

one direction, and there is

vehement disagreement over the

validity of the assumptions

underlying many of them. The

very difficulty of these policy

considerations, and Congress'

superior institutional

competence to pursue this

debate, suggest that legislative

not judicial solutions are

preferable.

Id. at 513 (footnotes and citations

omitted).

Furthermore, in the instant context

as in Patsy, serious questions have been

raised not only about whether there is a

need to amend the law, but also about the

design and scope of the proposed

amenoment. For example, Neil Bradley,

testifying against the proposal during

the 1982 hearings (on behalf of the

American Civil Liberties Union), pointed

out the difficulty of predicting the

outcome in some cases because an attorney

would not have received detailed facts

from discovery responses at the time of

the settlement offer, and in other cases

because statutory provisions, case law,

Or witnesses’ recollections might change

between the time of the offer and the

time of trial. 1982 Hearings, supra

p. 38, at 17-18, 29-31. Bradley also

noted that situations might well arise in

which an attorney would recommend

settlement, a client could refuse, and

that attorney would nevertheless be

obligated to continue representing that

client on a meritorious claim, but

without any compensation for his or her

services. Jd. at 17. In this situation,

as in the situation in which an attorney

is asked to simultaneously negotiate a

settlement of his or her own fees and a

settlement of the merits of a client's

Claim, Bradley emphasized the potential

for ethical problems. Jd. at 17-18,

29-31.

Fletcher Farrington, a private

practitioner from Southern Georgia who

had handled civil rights cases for both

plaintiffs and defendants under Section

1983, also testified against the proposed

amendment to Section 1988. 1982

Hearings, supra p. 38, at 52. Farrington

pointed out that a determination

(pursuant to the proposed statutory

language) of whether the relief embodied

in a final judgment was as favorable as

that tendered in a settlement offer would

often require collateral, case-by-case

litigation. Jd. Farrington also

expressed concern about the ethical

problems the proposed amendment would

engender, and suggested that the

available cost sanctions under Federal

Rule of Civil Procedure 68 were already

working to discourage unnecessary

litigation, without provoking the kinds

of attorney-client conflict likely to

result from an attorney's fee sanction.

1g. 2)/

As this testimony suggests, the

practical and policy issues surrounding

the imposition of an attorney's fee

Sanction are more appropriate for

legislative than judicial determination.

The Court weighed similar factors in

Patsy vy. Board of Regents, and observed:

These and similar questions

might be answered swiftly and

surely by legislation, but would

create costly, remedy-delaying,

and court-burdening litigation

if answered incrementally by the

———s - — —-

21/ None of the witnesses testifying at the 1981

or 1982 hearings took the position that either

Rule 68 or Section 1988 already provided for an

attorney's fee sanction of the type urged by

petitioners here.

judiciary in the context of

diverse constitutional claims

relating to thousands of

different state agencies.

457 U.S. at 514. In the instant case, a

determination to impose attorney's fee

sanctions for rejecting a settlement

offer will engender a similar series of

collateral substantive and procedural

questions with important policy

implications.

The difficulty of these issues will

be compounded by the fact that an

interpretation of Congressional purposes

and fee allocation mechanisms in not just

one, but several dozen varying statutory

schemes will be required. Although the

Allian:e for Justice (as amicus curiae)

respectfully submits that it is important

for the Court to be cognizant of these

policy issues, their resolution is best

reserved for Congress to consider.

III. THE INTERPRETATION URGED BY THE

PETITIONERS WILL ENGENDER MANY

PROBLEMS, _ ogtinas ocenmseones

If the Court adopts the

interpretation of Rule 68 and numerous

fee-shifting statutes urged by the

petitioners and the Solicitor General,

there will be a wide variety of problems

in refining that interpretation and

administering the fee sanctions which

will result. Many of these problems,

such as applying the rule to class

actions and cases involving declaratory

or injunctive relief, are explained in

the briefs of other amici supporting

respondents. Several others, however,

merit mention here.

A. Under Rule 68, Plaintiffs

and Their Counsel Must

Forfeit All Fees for Post-

Offer Services, Regardless

of Their Reasonableness

and Good Faith in Rejecting :

the Offer, a satin

The attorney's fee sanction

petitioners seek would apply

automatically, under the terms of Rule

68, whenever a plaintiff refuses a

settlement offer and then fails to obtain

a judgment that is as favorable.

However, such an automatic fee cutoff or

fee-shifting sanction will be highly

inequitable in many circumstances,

penalizing the plaintiff (and his or her

counsel) for a reasonable, good-faith

decision to continue litigating. As the

Court observed in Christiansburg Garment

Co. ve. EEOC, 434 U.S. 412, 422 (1978):

[S]eldom can a prospective

plaintiff be sure of ultimate

success. No matter how honest

one's belief that he has been

the victim of discrimination, no

matter how meritorious one's

Claim may appear at the outset,

the course of litigation is

rarely predictabl.. Decisive

facts may not emerge until

discovery or trial. The law may

change or clarify in the midst

of litigation. Even when the

law or the facts appear

questionable or unfavorable at

the outset, a party may have an

entirely reasonable ground for

bring suit.

Recently, the Justice Department made the

Same point in a letter questioning a

proposal by the Advisory Committee on the

Federal Rules of Civil Procedure to

expressly amend Rule 68 to include fee

cutoff and fee-shifting sanctons:

"[E]valuating litigation hazards is an

extremely difficult task in any suit."

Letter from D. Lowell Jenson, Acting

Deputy Attorney General to the Honorable

Edward T. Gignoux, Chair, Committee on

Rules of Practice and Procedure, February

28, 1°°4 (copy on file at the

Administrative Office of the United

States Courts).

Moreover, in many cases it is likely

that the margin between the rejected

offer and the judgment obtained will be

relatively small. The instant case is a

good example: Petitioners assert that

their offer was for $100,000 (inclusive

of attorney's fees); the respondent

ultimately recovered $92,000 (a verdict

of $60,000 in damages and pre-offer fees

in the amount of $32,000). It is unfair

to penalize plaintiffs who have litigated

in good faith under such circumstances.

Members of the Advisory Committee, in a

draft Note accompanying their recent

proposal to include attorney's fee

sanctions in Rule 68, termed such an "all

or nothing" rule of this type "Draconian"

in its impact. 98 F.R.D. 337, 365

(1983).

B. The Petitioners’ Interpretation

of Rule 68 Will Engender Sub-

stantial Litigation on

Collateral Issues, ttt

Faced with such drastic fee

sanctions, both parties and their counsel

are likely to raise a substantial number

of problems and issues in collateral

litigation: For example, was the Rule 68

offer valid in its form? Was the

judgment obtained actually less favorable

than the rejected offer, particularly

insofar as either the offer or judgment

(or both) included declaratory or

injunctive relief? What effect, if any, \

should the rejection of a reasonable

counter-offer neve on the imposition of

sanctions?

Morecver, many litigants will

assert, as the petitioners and the

Solicitor General imply throughout their

briefs, that notwithstanding the

mandatory terminology used in Rule 68, @

court's imposition of fee sanctions for

refusing a settlement offer should be

discretionary, and based either on the

"reasonableness" of the offer or the

"unreasonableness" of its rejection.

Even assuming, argquends, that Rule 68 can

be construed as providing a district

judge with discretion to deny an

attorney's fee sanction, additional

questions and difficulties (of the type

described below) will arise in collateral

litigation. This litigation will require

a substantial use of judicial resources

on non-substantive issues, and prove

problematic for judges, parties and their

attorneys. Neither Rule 68 nor Section

1988 contain any standards to guide the

courts in addressing these questions.

For example, if a plaintiff seeking to

avoid the imposition of Rule 68 sanctions

must demonstrate that the rejection of an

offer was reasonable at the time it was

made, that plaintiff or his or her

attorney may be forced to reveal

privileged attorney-client communications

or confidential work product material.

This is particularly problematic if an

appeal or related cases are still

pending.

However, if the district judge

postpones attorney's fee proceedings

until after an appeal or the conclusion

of related litigation it will be

virtually impossible to determine the

"reasonableness" of the rejection of the

settlement offer. As Justice Rehnquist

observed in his dissenting opinion in

Delta Airlines, Inc, vy. August,

To import into the mandatory

language of Rule 68 a

requirement that the tender of

judgment must be “reasonable” or

made in “good faith” not only

rewrites Rule 68, but also puts

a district court in the

impossible position of having to

evaluate such uncertain and

nebulous concepts in the context

of an “offer of judgment" that

may in many cases have been made

years past.

450 U.S. at 369 (1981).

Additionally, the adoption and

administration of fee sanctions as urged

by petitioners and the Solicitor General

will greatly increase the potential for

conflict in the attorney-client

relationship, for several reasons.

First, the kinds of disclosure problems

outlined above will surface frequently,

and will require a difficult balancing of

competing interests.

Second, because the petitioners and

the Solicitor General urge this Court to

construe Rule 68 in a manner that would

appear to require simultaneous negotia-

tion of the merits and the fee award, and

because the stakes for the attorney will

be higher than they are now, the existing

potential for conflict between an attor-

ney and client in this situation will be

exacerbated. Although the problems of

simultaneous negotiation have been widely

recognized (see, €,9,, Mendoza vy. United

States, 623 F.2d 1338, 1352-53

(9th Cir. 1980), cert, denied sub nom,

Sanchez vy, Tucsop Unified School

District, 450 U.S. 912 (1981); Prandini

vy. Nationa] Tea Co,, 557 F.2d 1015, 1021

(3d Cir. 1977); gee also Opinion No.

80-94 of the Committee on Professional

and Judicial Ethics of the New York City

Bar Association, 36 Record of the

N.Y.C.B.A. 507 (1981)), no satisfactory

solutions have been identified.22/

Third, there will be further

conflict resulting from the fact that the

rules of professional responsibility

require a lawyer to "abide by a client's

---——_—— - - - =

Brief filed by the NAACP Defense and Educational

Fund, Inc. (in Respondent's Support).

Gecision whether to accept an offer of

Settlement of a matter..." (ABA Model

Rules of Professional Conduct, Rule

1.2(a); emphasis supplied), but the

Sanctions petitioners are seeking for the

refusal of an offer will fall most

heavily on the attorney (who in some

instances may have even recommended that

his or her client accept the settlement

offer). These problems will prove

difficult, if not insurmountable, for the

courts and will gradually and

increasingly deter attorneys from

accepting cases covered by the

fee-shifting statutes.

IV. THE RULE URGED BY PETITIONERS IS

NOT NECESSARY TO CURB ANY

ALLEGED LITIGATION PROBLEMS, _

Petitioners and the Solicitor

General are proposing a remedy for what

they allege are litigation problems under

fee-shifting statutes. However, they

have failed to demonstrate that the

problems they allege in fact exist or are

serious enough to warrant the drastic

measure they propose. They have failed to

show, for example, that the respondent in

this case acted unfairly or unreasonably;

a careful review of the facts surrounding

the settlement offer would seem to

suggest just the contrary. See Statement

of the Case in Respondent's Brief.

Moreover, they have failed to demonstrate

that civil rights plaintiffs or

plaintiffs under fee-shifting statutes

generally act unfairly or unreasonably in

considering settlement offers.

In many cases, civil rights and

public interest plaintiffs have fairly

and successfully negotiated

settlements.23/ here is no evidence

23/ See the case examples, cited supra pp. 6-7

nn. 10, ll.

that the incentives to do so are Office of the United States Courts).

inadequate. As the Honorable James Existing law already provides

McGirr Kelly, United States District district courts with authority (and

Judge for the Eastern District of guidance) to curb abuses if and when

Pennsylvania, observed in opposing the attorneys litigate in bad faith under

recent Advisory Committee proposal to fee-shifting statutes, or refuse to

increase Rule 68 sanctions: entertain settlement offers in good

It has been my experience that faith. Case law provides that in such

the economic incentives to P

accept reasonable offers are circumstances a fee award may be refuse

generally more than sufficient e313 8.26

in the settlement of cases. altogether. Brown vy. Stackler, .

While it is true that sometimes

reasonable offers may be 1057 (7th Cir. 1980); Naprstek vy, City of

rejected by a part these are

only in exceptional matters. I Norwich, 433 F. Supp. 1369 (N.D.N.Y.

do not believe a rule change so

Sweeping as proposed in the 1977) .24/

above amendment to Rule 68 is

required or even desirable. However, the courts that have

Instead of improving the considered the matter have been careful

efficiency of our Courts, the

proposed amendments may actually to note that the rejection of a

add an additional responsibility

on an already overburdened settlement offer may well] be fair and

judiciary.

reasonable, and should not, in and of

Letter from the Honorable James McGirr ; , ;

itself, be a basis for denying attorney's

Kelly to the Committee on Rules of

ee ee ee ee ee 3

28 U.S.C. § 1927

d b 24/ See also the provisions in

ne ne eee ee <dioe (as amended in 1980) for sanctioning attorneys

(copy on file at the Aaministrative who multiply or prolong litigation unreasonably

and vexatiously.

fees. Coop vy, City of South Bend, 635

F.2d 652, 655 (7th Cir. 1980); Mid-Hudson

Legal Services v, G, & U.,», Inc,, 465

F. Supp. 261, 267 (S.D.N.Y. 1978).

It is logically unsound, and unfair,

to make the decision about whether or not

to accept a settlement offer the sole or

even the primary basis for sanctioning an

attorney when the rules governing

professional responsibility provide for

the client to make that choice. The

decision about whether or not to settle

is often a difficult one, and one which

ultimately should be reserved for the

client to make.

CONCLUSION

For the foregoing reasons, the

judgment of the Court of Appeals for the

Seventh Circuit should be affirmed.

Respectfully submitted,

LAURA MACKLIN*/

Institute for Public

Representation

600 New Jersey Avenue, N.W.

Washington, D.C. 20001

(202) 624-8390

Counsel of Record for the

Alliance for Justice as

Amicus Curiae

*/ Christopher Palmer and Anthony Ruvolo,

second year students at Georgetown University

Law Center, provided valuable assistance in the

researching and drafting of this brief.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.