# Amicus Curiae Brief — Marek v. Chesny

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URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385012_1355%3A11

## Record

- **Collection:** Supreme Court brief
- **Document type:** Amicus Curiae Brief
- **Published:** January 1, 1985
- **Citation:** 473 U.S. 1

## 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

© BEST AVAILABLE COPY

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

12

12

12

17

22

II.

IIl.

D.

iV

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 ..

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
GBBGS esreeoeevses

The Petitioners’
Interpretation of Rule 68
Will Engender Substantial
Litigation on Collateral
Issues eh in oe a 2

27

32

36

49

50

53

IV. THE RULE URGED BY PETITIONERS
IS NOT NECESSARY TO CURB ANY
ALLEGED LITIGATON PROBLEMS

CONCLUSION

58

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

21

33

22

25

5,6

6

4

ix

. ’ 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

rs

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:

57

62

61

5,6

37 ,38,43-
44,47-48

22

21

57

xi

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

4

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

10

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

ll

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

12

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

13

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

14

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.

15

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,

16

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.

17

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

18

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

19

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

20

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/

21

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)).

22

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

23

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

24

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

'

25

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

26

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).

27

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

28

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.

29

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

30

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

31

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

33

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

34

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

35

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

36

“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

37

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

38

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

39

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.

40

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

41

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

42

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.

43

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

44

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

45

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

46

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

47

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.

48

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.

49

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.

50

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

51

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).

52

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).

53

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, @

54

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

55

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

56

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

57

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).

58

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

59

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.

61
60

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.

62

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.

63

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.

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385012_1355%3A11. Public record. Not legal advice.