# Petition for Writ of Certiorari — District of Columbia v. Covington

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1996
- **Citation:** 516 U.S. 1115

## Text

‘95 -910 F I LE

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No. 95 ; DEC 8 95

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In the Supreme Court of the United States

OctceerR TerRM, 1995

District oF CoLuMBIA, et al,
Petitioners,

Ve

DarRRYL CovINGTON, et al,
Respondents.

Petition for a Writ of Certiorari
to the United States Court of Appeals
for the District of Columbia Circuit

CHARLES F.C. Rurr,

Corporation Counsel

CHARLES L. REISCHEL,
Deputy Corporation Counsel
Appellate Division

*DonnaA M. Murasky,
Assistant Corporation Counsel

Office of the Corporation Counsel
One Judiciary Square

Sixth Floor South

441 Fourth Street, N.W.
Washington, D.C. 20001
Telephone: (202) 727-6252 ext. 3303

*Counsel of Record

4
f
4
,
:

QUESTION PRESENTED

Whether private, for-profit attorneys, who prevail in federal fee-
shifting litigation, may be awarded hourly rates which exceed the
rates they have ever charged their fee-paying clients and the rates
charged by comparable counsel in similar litigation even though
Blum v. Stenson, 465 U.S. 886 (1984), and City of Burlington vy.
Dague, 112 S. Ct. 2638 (1992), require that hourly rates awarded
under federal fee-shifting statutes reflect market rates and bar
contingency enhancements.

PARTIES

This petition seeks review of a decision of the United States
Court of Appeals for the District of Columbia Circuit in an appeal
in which three cases in the United States District Court for the
District of Columbia were consolidated: Covington v. District of
Columbia, Civil Action No. 87-2658; Sexcius v. District of Colum-
bia, Civil Action No. 88-2104; and Galloway v. The Superior
Court, Civil Action No. 91-0644. The parties in this Court are as
follows:

Covington. Petitioners, who were the original defendants below,
are: District of Columbia, Raymond Barnes, James Bryant, Philip
D. Bullock, Leslie C. Childs, David P. Dalton, Herbert H. King,
Robert Newkirk, Mario L. Randle, George M. Cutler, Roland J.
Jackson, Reginald Nickens, Frederick Shuler, Lavel D. Johnson,
Dana Marshall, Luay A. Sese-Khalid, and Rita Goodall. Respon-
dents, who were plaintiffs below, are: Darryl Covington, Tracy
Dew-Bey, David Edwards, Lee Roy Ferguson, Raymond Gant,
Charles Harris, Donald Hunt, Larry Lee, Leo Wright, and Charles
Barber.

Sexcius. Petitioners, who were defendants below, are the
District of Columbia; its Mayor, Marion Barry, as successor to
Sharon Pratt Kelly; the District of Columbia Board of Education and
its Superintendent, Dr. Andrew E. Jenkins III, as successor to Dr.
Franklin L. Smith; Lucille E. Christian; and Mary B. Hendrick.
Respondents, who were plaintiffs below, are Sheriel L. Sexcius and
William F. Edmead.

Galloway. Petitioners, who were defendants below, are the Dis-
trict of Columbia Courts; the Superior Court of the District of
Columbia; Ulysses B. Hammond, in his official capacity; the Board
of Judges of the District of Columbia; Eugene N. Hamilton, as
successor to Fred B. Ugast; Ray Wynn, in his official capacity; and
the District of Columbia. Respondent, who was the plaintiff below,
is Donald Galloway. The United States appeared in the United
States District Court as amicus curiae.

TABLE OF CONTENTS

Page
QUESTION PRESENTED ................
ha A ea AG T
a Sina er Lr a |
EY Eg RS ob 2
STATUTORY PROVISIONS INVOLVED ........ 2
STATEMENT OF THE CASE ............. 2
a a 2
Il. THE LAFFEY MATRIX. ........... 5
III. THE District Courts’ DECISIONS. . . 7
A. Their Common Threads. .. . 7
a ere | )
a A ag A ee 13
a | 13
[V. THE COURT OF APPEALS. ......... ; 14
REASONS FOR GRANTING THE WRIT .............. 17
I. THE DECISION OF THE PANEL Majority Is IN

CONFLICT WITH THE DECISIONS OF THIS CouRT... 18
A. THIS CouRT’s DECISIONS. ......... ir 18
B. THE PANEL Majoriry’s DECISION. ........ 19

Il. THE PANEL Majoritry’s DECISION Is IN CONFLICT
WITH THE DECISIONS OF OTHER CIRCUITS. 23
a s 30

TABLE OF AUTHORITIES

CASES
Barrow v. Falck, 977 F.2d 1100 (7th Cir. 1992) meee fe
Barrow v. Falck, 11 F.3d 729 (7th Cir. 1993) ......... 26
Beard v. Teska, 31 F.3d 942 (10th Cir. 1994) .......... 27
Blum v. Stenson, 465 U.S. 886 (1984) ............ passim
Casey v. Cabool, Missouri, 12 F.3d 799 (8th Cir. 1993),
cert. denied 115 §. Ct. 325 (1994) ............... 27

Chambless v. Masters, Mates & Pilots Pension Plan,
885 F.2d 1053 (2d Cir. 1989), cert. denied,

Te Ws SE ier at ee ee ES hes 28
City of Burlington v. Dague, 112 S. Ct. 2638 (1992) .. passim
Coulter v. Tennessee, 805 F.2d 146, (6th Cir. 1986),

cert. denied, 482 U.S. 914 (1987)) .............. 24

Davis v. San Francisco, 976 F.2d 1536 (9th Cir. 1992) . . 22,28
Goos v. National Ass'n of Realtors, 997 F.2d 1565

6 Rts Ee % o's a sete aha ard aie ornte tea te4 08 4,29
Gusman v. Unisys Corp., 986 F.2d 1146 (7th Cir. 1993) ... 27
Hall v. Ochs, 817 F.2d 920 (Ist Cir. 1987) ............ 24
Islamic Center of Mississippi, Inc. v. Starkville,

Mississippi, 876 F.2d 465 (Sth Cir. 1989) ......... 29
Kattan v. District of Columbia, 995 F.2d 274 (D.C. Cir.

1993), cert. denied, 114 S. Ct. 1398 (1994) ......... 29

King v. Palmer, 906 F.2d 762 (D.C.Cir. 1990),

rev'd, 950 F.2d 771 (D.C. Cir. 1991) (en banc),

cert. denied sub nom., King v. Ridley,

jog Ms MF Pee ee eee errr 19,21
King v. Palmer, 950 F.2d 771 (D.C. Cir. 1991) (en banc),

cert. denied sub nom., King v. Ridley,

fe) Be Be: ee ene passim
Laffey v. Northwest Airlines, Inc., 572 F. Supp. 354

(D.D.C. 1983), rev'd, 746 F.2d 4 (D.C. Cir. 1984),

cert. denied, 472 U.S. 1021 (1985) ............. 5.6
Laffey v. Northwest Airlines, Inc. , 746 F.2d 4 (D.C. Cir.
1984), cert. denied, 472 U.S. 1021 (1985) ......... 24

sie:

Lightfoot v. Walker, 826 F.2d 516 (7th Cir. 1987), ...... 23
Mayson v. Pierce, 806 F.2d 1556 (11th Cir. 1987)

i I on So ee ee Oe eo is se wo ee 23
McKenzie v. Kennickell, 875 F.2d 330 (D.C. Cir. 1989)... .. at
National Ass'n of Concerned Veterans v. Secretary of Defense,

675 F.2d 1319 (D.C. Cir. 1982) .............. 16,20
Pennsylvania v. Delaware Valley Citizens’ Council

for Clean Air, 483 U.S. 711 (1987) .............. 24
Rum Creek Coal Sales, Inc. v. _

31 F.3d 169 (4th Cir. 1994) . ‘4 Pee

Save Our Cumberland Mountains, Inc. v, Hodel,
826 F.2d 43 (D.C. Cir. 1987), rev'd,

857 F.2d 1516 (D.C. Cir. 1988) (en banc). ...... 23
Save Our Cumberland Mountains, Inc. v. Hodel,
857 F.2d 1516 (D.C. Cir. 1988) (en banc). ..... . passim

Shakopee Mdewakanton Sioux Community v. Prior Lake,
771 F.2d 1153 (8th Cir. 1985), cert. denied,

Cie Us BOON CIGD 66s ve oo ve wees Pe
Student Public Interest Research Group v. AT & T Be -

Laboratories, 842 F.2d 1436 (3d Cir. 1988) .... 23.24.28
U.S. Dep’t of Labor v. Triplett, 494 U.S. 715 (1990) ee
Webb v. Maldonado, 484 U.S. 990 (1987) ............ 24
White v. Richmond, 713 F.2d 458 (9th Cir. 1983) ...... 24.28

STATUTES

ae aes © UR oe ee ee eee 2
ae Ve Oe oad ele eee eee
Ce en OU ok eee ee ee 2.9
Individuals with Disabilities Education Act,

oe Ue. 6 ee 6 eo a ee ee ee elee
Rehabilitation Act of 1973, 29 U.S.C. § 794a(b). ......... 2

IN THE SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1995

DISTRICT OF COLUMBIA, ef al..,
Petitioners,

V.

DARRYL COVINGTON, ef ai.,
Respondents.

Petition for a Writ of Certiorari
to the United States Court of Appeals
for the District of Columbia Circuit

The District of Columbia and several of its officials and em-
ployees petition this Court for a writ of certiorari to review a
decision of the United States Court of Appeals for the District of
Columbia Circuit.

OPINIONS BELOW

The decision of the United States Court of Appeals for the
District of Columbia Circuit (App. 1-27), in an appeal in which the
court consolidated three cases, is reported at 57 F.3d 1101. Two
of the three decisions of the United States District Court for the
District of Columbia it reviewed are reported: Covington v. District
of Columbia, 839 F. Supp. 894 (D.D.C. 1993) (App. 28-51), and
Sexcius v. District of Columbia, 839 F. Supp. 919 (D.D.C. 1993)
(App. 52-75). The third, Galloway v. The Superior Court for the
District of Columbia, Civil Action No. 91-0644 (D.D.C. Apr. 21,
1994) (App. 76-81), is not reported.

The court of appeals had jurisdiction pursuant to 28 U.S.C. §
1291.

2

JURISDICTION

The D.C. Circuit entered its original judgment on June 23,
1995. The District of Columbia filed a timely petition for rehearing
and a suggestion for rehearing en banc. The petition and suggestion
were denied on September 12, 1995. App. 82 & 83. This Court
has jurisdiction pursuant to 28 U.S.C. § 1254(1).

STATUTORY PROVISIONS INVOLVED

This case involves 42 U.S.C. § 1988 and the Rehabilitation Act
of 1973, 29 U.S.C. § 794a(b). 42 U.S.C. § 1988 provides in perti-
nent part:

In any action or proceeding to enforce a provision of
section{] 1983 . . . of this title, . . . the court, in its discre-
tion, may allow the prevailing party . . . a reasonable
attorney’s fee as part of the costs.

Section 7942(b) of the Rehabilitation Act provides in pertinent
part:

In any action or proceeding to enforce or charge a violation
of a provision of this subchapter, the court, in its discre-
tion, may allow the prevailing party . . . a reasonable
attorney’s fee as part of the costs.

STATEMENT OF THE CASE
I. INTRODUCTION.

The cases before this Court all involve fee awards to private,
for-profit practitioners under federal fee-shifting statutes. In each
of the cases, counsel sought, and received, fees at hourly rates in
excess, and usually substantially in excess, of the rates charged to
their clients in these cases and of any rate they had ever commanded
in the marketplace. They received these rates even though this
Court has ruled that attorneys must be paid at market rates when

|

3

they prevail in federal fee-shifting litigation and that market-based
fees may not be enhanced because a case has been taken on a
contingent basis in whole or in part.

In Blum v. Stenson, 465 U.S. 886 (1984), this Court ruled that
not-for-profit legal organizations which successfully represent clients
under federal fee-shifting statutes must be compensated at the
prevailing market rates for their services. At the same time, howev-
er, this Court recognized that “there is no such thing as a prevailing
market rate for the service of lawyers in a particular community."
Id. at 895 n.11. On the contrary, "[t}he type of services rendered
by lawyers, as well as their experience, skill, and reputation, varies
extensively -- even within a law firm," and "[alccordingly, the
hourly rates of lawyers in private practice also vary widely." /d.
This Court also placed on fee applicants the burden of demon-
strating the market rate or rates to which their counsel are entitled.

In Save Our Cumberland Mountains, Inc. v. Hodel, 857 F.2d
1516 (D.C. Cir. 1988) (en banc) ("SOCM"), the D.C. Circuit
extended Blum to attorneys who practice for profit but who take
public-interest, or federal fee-shifting, cases on a reduced-fee basis.
It ruled that such attorneys should be paid “at rates commensurate
with prevailing community standards of attorneys of like expertise
doing the same sort of work in the same area." Id. at 1521 (empha-
sis added). In so ruling, the court expressly disclaimed that it
intended to adopt a rule "that all attorneys be remunerated at the
same rate, regardless of their competence, experience, and market-
ability," and stated that it intended only “to provide that their exper-
ience, competence, and marketability will be reflected in the rate at
which they are in fact remunerated." Jd. at 1521 n.4.

Four years later, this Court ruled that contingency enhance-
ments are not available under federal fee-shifting statutes and that,
in the absence of extraordinary circumstances, a fee award must be
limited to a lodestar award -- an award calculated by multiplying the
reasonable number of hours spent on a case by a reasonable hour! y
rate. City of Burlington v. Dague, 112 S. Ct. 2638 (1992).

a

With the demise of contingency enhancements, counsel for
prevailing plaintiffs in the District of Columbia routinely began to
argue that the hourly rates which they charged their fee-paying
clients, and which they previously had sought in their lodestar
awards, were below-market and thus not reasonable. See, ¢.xz.,
Goos v. National Ass'n of Realtors, 997 F.2d 1565, 1568-69 (D.C.
Cir. 1993) (abandoning argument for a contingency enhancement in
light of Dague and urging for the first time on appeal that the
hourly rate the attorney ordinarily charged his clients and sought at
the trial level was a below-market rate).

In the three cases before this Court, the highest hourly rates
ever charged by lead counsel were $150.00, $187.50, and $200.00.
yet each requested, and received, $260.00 per hour. The courts
below accepted counsels’ representations that even the highest
hourly rates they agreed to accept from paying clients in the market-
place, whether in fee-shifting or non-fee-shifting cases, were below-
market rates. The principal basis for these awards is a pre-B/um
attorney-fee matrix, known as the Laffey matrix.

These awards are fundamentally flawed. First, the courts below
have created presumptive market rates based on data for the entire
District of Columbia Bar -- the Laffey matrix -- that would not even
support an inference that these rates are reasonable rates for the
attorneys here. In the process, the courts below have impermissibly
shifted the burden of proof for establishing reasonable hourly rates
from fee applicants to defendants. Second, in awarding hourly rates
that exceed the rates charged both by prevailing counsel to their fee-
paying clients here and in other cases, and by counsel with compa-
rable experience, skill, and reputation in similar cases, the courts
below have approved above-market hourly rates. Such rates are not
authorized by Blum and are indistinguishable from the contingency
enhancements condemned in Dague. Not surprisingly, the panel
majority’s decision here is in conflict with other Circuits interpret-
ing Blum and Dague. Review is necessary to resolve the D.C.
Circuit’s conflicts with the decisions of this Court and other Cir-
cuits, as well as to resolve other conflicts among the Circuits
concerning the meaning of Blum.

Il. THE LAPFEY MATRIX.

The key to understanding the decisions below is the Laffey
matrix. The Laffey matrix was developed in the early 1980's in
Laffey v. Northwest Airlines, Inc., 572 F. Supp. 354 (D.D.C.
1983), to determine what hourly rates wo-ld be reasonable for the
successful plaintiffs’ counsel in that case. Three aspects cf the
matrix are important here -- its structure, purpose, and validity.

Structure. The Laffey matrix established hourly rates for attor-
neys based solely on the number of years they have been in prac-
tice; divided them into five experience groups; and assigned to each
group a single hourly rate as the market rate. /d. at 371. The
Laffey matrix has been updated. Under the latest figures in the
record (App. 39-40), those for 1992-1993, the hourly rates assigned
to each experience group are as follows:

Years of Experience Rate

20+ - very experienced federal litigators $300.00
11 to 19 - experienced federal litigators $260.00
8 to 10 - experienced litigators $225.00
4 to 7 - senior associates $175.00
1 to 3 - junior associates $130.00

Purpose. The Laffey matrix was developed to help determine
reasonable hourly rates for several attorneys of superior skill and
expertise who had litigated to a very successful conclusion a com-
plex Title VII class action. In Laffey, 25 affidavits were submitted
on behalf of plaintiffs’ counsel by "an impressive array of legal
personages" attesting “to the actual rates charged by lawyers at
some of the most prestigious law firms in Washington, D.C.; . . .
the complexity and significance of Laffey; and the experience,
expertise and sterling reputation of Plaintiffs’ counsel." 572 F.
Supp. at 367 & 367 n.24. Thus, the assumptions built into the
matrix are clear: it was designed to reflect rates paid to attorneys
of “extraordinary experience and expertise” engaged in very com-

6

plex and successful litigation. Jd. at 374. Indeed, in Laffey itself,
the district court recognized the special nature of the matrix and
refused to apply it mechanically. Thus, it reduced the "generous"
Laffey-matrix rates by one-third in awarding fees to one attorney
because he did not have the superior skills and expertise of lead
counsel, even though it expressed 5 dissatisfaction with his
performance. /d. at 374; see id. at 375 2.37.

Validity. The assumptions underlying the matrix were not
litigated. The defendant in Laffey did not dispute that plaintiffs’
lead counsel was "‘one of the premier employment discrimination
firms in the country" or that the matrix was "an accurate depiction
of the prevailing market rates for lawyers of comparable skill and
ability who represent defendants in complex Title VII cases." /d.
at 372 (internal quotations omitted). As a result, the validity of
Laffey’s sample of rates and the methodology used to select the
Laffey-matrix rates was not proven, even for the limited purpose for
which the matrix was devised.

There is only one other important matter to be noted about the
Laffey matrix -- it has been “updated” in two different ways. One
“update” has been based on information provided from time to time
by various members of the private bar in the District of Columbia.
App. 7. The other “update” has been based on the Consumer Price
Index by the U.S. Attorney’s Office in the District and is used to
establish a rate ceiling in settlement negotiations. App. 8 n.14.'

‘James R. Layton, an Assistant U.S. Attorney for the District of
Columbia, who prepared that matrix, explained that the rates in the matrix
are often higher than those charged by attorneys to their clients and that the
office uses the matrix as a cap:

I. . . have compared the rates given in the matrix to rates
given in affidavits submitted by attorneys in support of fee
applications as those applied by attorneys to their paying clients,
and have deteymined that most, although not all, such rates are
at or below the rate shown in the matrix.

(continued...)

:
ill. THE District Courts’ DECISIONS.
A. Their Common Threads.

In awarding fees in the cases before this Court, the district
courts adopted the principle that all attorneys who are engaged in a
for-profit practice, but who charge hourly rates in "public-interest”
(i.e., fee-shifting) cases that are less than Laffey-matrix rates, are
charging below-market rates and must be compensated at Laffey-
matrix rates. According to these courts, plaintiffs met their burden
of establishing reasonable hourly rates by introducing (1) the Laffey
matrix, as updated by the private bar, and (2) the U.S. Attorney's
Office Laffey-based matrix. The courts so ruled even though they
recognized the crudeness of these matrices. App. 36, 60, & 78 n.1.

These courts found unpersuasive the District's evidence, drawn
mostly from federal court cases against it. This evidence showed
that seven experienced (11-19 years) or very experienced (20+
years) plaintiffs’ attorneys with practices similar to lead counsel here
were charging hourly rates of $125.00 to $150.00 to their fee-
paying clients. App. 36.2 The District’s evidence also included

l(, . continued)

. . « We do not, in settling cases, allow counsel to recover at
rates in excess of those shown in the matrix.

J.A. (I1)87 (emphasis added). References to "J.A." in this Petition are
references to the Joint Appendix filed in the court of appeals in this case.

"This evidence, showing the actual rates charged by counsel in cases

similar to those before the Court and the applicable Laffey-matrix rates,
may be illustrated as follows:

(continued...)

telling affidavits filed by two of the key players in the contingency-
enhancement litigation in the D.C. Circuit, Robert Adler and Joel
Bennett. Neither of them ever suggested during that litigation that
the hourly rate they were charging clients, and seeking in their fee
applications, was a reduced, or below-market, rate, even though
their then-current rate of $135.00 was far below the then-applicable
Laffey rates of $200.00-$210.00.

On the contrary, Mr. Bennett’s 1987 affidavit in McKenzie v.
Kennickell, 875 F.2d 330 (D.C. Cir. 1989), stated:

My current minimum hourly rate in all cases, including
employment discrimination, is $135.00 per hour... . At
one time I did accept employment discrimination clients
based on a reduced rate with the intent of recovering court
awarded fees based on my full rate if | prevailed, but /
stopped this practice in 1981.

2(.. continued)
Year Attorney Experience Hourly Laffey
(Years) Rate Rate

1987 R. A. Adler 19 $135.00 $200.00/2 10.00
1987 J. P. Bennett 14+ $135.00 $200.00/210.00
1990s R.. L. Bell 10+ $150.00 $230.00/240.00
1991 G.H. Simpson 18 $125.00 $240.00/250.00
1992 T. F. Fay 25 $144.00 $290.00/300.00
1992 J.J. McCarthy 13 $150.00 $250.00/260.00
1992 C. S. Steel 15 $150.00 $250.00/260.00
1992 J. P. Hart 20 $150.00 $290.00/300.00
1992 J. Harvill 18 $150.00 $250.00/260.00

Two figures are shown in the last column because the Laffey matrix is set
up on a June | to May 31 time frame. Therefore, the rate for any
experience group differs depending on whether fees are sought in the first
or the second half of any calendar year.

9

J.A. (1)232 (emphasis added). Mr. Adler’s fee application in King
v. Palmer’ also confirmed that an hourly rate of $135.00 for experi-
enced attorneys in employment discrimination cases in 1987 was a
market rate. Mr. Adler stated that this rate was the rate "charged
to all clients of the firm who were billed on an hourly basis" and
the rate "regularly charged by counsel for performing similar work
in private representation." J.A. (1)269. Furthermore, Mr. Adler
stated that this rate fell “within the rates charged by other firms for
similar work in the same community." J.A. (1)269 (emphasis added)
(internal quotation marks omitted). In other words, in pre-Dague
fee litigation, experienced counsel in the District doing the same
kind of work as counsel here did not regard their below-Laffey-
matrix rates as reduced, or below-market, rates.

B. Covington.‘

This was a prisoner-rights case taken on a wholly contingent-fee
basis in which a fee award was sought under 42 U.S.C. § 1988.
Lead counsel were Daniel M. Schember and Michael J. Gaffney of
Gaffney & Schember, P.C., a firm which has a “general litigation
practice," including “various federal administrative proceedings."
J.A.(1)159. In support of their fee request, counsel submitted a
modestly detailed application. It included declarations by Messrs.
Schember and Gaffney in which they averred that they have concen-
trated their practices as plaintiffs’ lawyers in employment, civil
rights, and similar cases.

Importantly, their declarations demonstrated that they have
responded to market conditions by charging rates below those
charged by large firms and by maintaining fairly constant rates over

°950 F.2d 771 (D.C. Cir. 1991) (en banc), cert. denied sub nom.,
King v. Ridley, 112 S. Ct. 3054 (1992).

“The District limits its factual presentation to lead counsel in each of
these cases. However, the Laffey matrix was used to set rates for all other
counsel and paralegals except in those circumstances in which Laffey-
matrix rates inexplicably were not sought.

10

the years. Thus, Mr. Gaffney, a 1975 law school graduate, charged
a range of hourly rates as late as 1992 as follows: $50.00, $100.00,
$120.00, 125.00, $140.00, and $150.00; and Mr. Schember, a 1974
law school graduate, charged rates of $125.00 and $150.00 in 1992
(and a range of lower rates in earlier years). J.A. (1)170-71. From
1986 to June, 1990, their top hourly rate was $125.00; and from
June, 1990, to the time they filed their fee application in December,
1992, their top hourly rate was $150.00. J.A. (1)171.

Despite their own evidence of the rates they can command in
the marketplace, these attorneys requested that the District be
required to pay them at Laffey-matrix hourly rates, or $260.00.
App. 39-40. The reason for seeking greater remuneration from the
District than they charged their clients was summarized by Mr.
Schember as follows:

. . . [OJur firm has historically been, and continues to be,
a quasi public interest firm whose attorneys practice pri-
vately and for profit, but at below-market rates reflecting
non-economic .goals. We have customarily charged below
the prevailing market rate to accommodate our clients’ |
limited means and the importance of their cases.

J.A. (1159.

In granting their request, the Honorable Royce C. Lamberth
stated that "(t]he most difficult issue . . . is establishing the reason- |
able hourly rate." App. 31; see also App. 39. He explained that ,
his task was to “determine the ‘prevailing market rates in the |
relevant community,’ and award counsel that as the reasonable
hourly rate" because, "[i]n the D.C. Circuit, this . . . method... .
is . . . used to determine the attorney’s fees owed to ‘privately
practicing but public interest motivated attorneys who intentionally
charge their poorer clients reduced rates.’*" App. 32. He concluded
that the firm was entitled to Laffey-matrix rates because the District
of Columbia had failed to "produce[] enough evidence that plaintiffs’
counsels’ ordinary billing rates -- about $150 per hour -- are not
below market value.” App. 32.

TE a ee me

11

His decision turned on two inquiries: the definition of the
relevant market and the determination of the prevailing hourly rate
in that market. The District urged that the relevant market be
defined as attorneys who file civil rights, employment discrimina-
tion, and similar suits, while plaintiffs urged a market composed of
attorneys who are involved in complex federal litigation. App. 33.
Judge Lamberth analyzed the issue as follows:

[The District’s] position may be plausible. . . . [T\he legis-
lative history of § 1988 and subsequent Supreme Court and
District of Columbia circuit caselaw construing attorney's
fee statutes make clear that in resolving any particular
attorney’s fee question under § 1988 (including this sub-
market question), courts must aim to award attorney's fees
that mirror what counsel would earn in the market. If the
market would provide different sub-markets of lawyers
different rates, courts properly aiming to mirror the market
would award lawyers in each sub-market the fees that their
particular services command in the marketplace.

App. 33-34 (emphasis added) (footnotes omitted).

Judge Lamberth nevertheless accepted “plaintiffs’ theory that the
relevant market should be very broadly defined . . .." App. 38-39
(emphasis added). The District had failed to “produce{] enough evi-
dence . . . that the prevailing rate in the sub-market... is...
lower than the rate prevailing in the broader legal market." App.
35. By contrast, plaintiffs had met their burden of defining the
relevant market by introducing the two updated Laffey matrices.
App. 35-36; see also App. 39-40. Judge Lamberth so ruled even
though he recognized that the District’s criticisms of these matrices
-- that they "represent{] only a small percentage of the District of
Columbia’s Bar, and . . . omit[{] the ‘lower end of the market’ of
legal services -- may have merit .. ..". App. 36 (emphasis added).

Judge Lamberth explained:

12

For their own part, defendants have not presented persua-

sive evidence that the fees earned by plaintiffs’ lawyers in

the sub-market of civil rights, employment, and discrimina-

tion litigation are lower than the fees earned in the broader

market of complicated federal litigation. .. . For example,
. . . [their] affidavit cites only seven instances in which
lawyers with 10-20 years of experience charged about $150
per hour in representing plaintiffs in civil rights, employ-
ment, or discrimination matters. . . . These seven instanc-
es look suspiciously representative of only the lower end of
the sub-market. . . . Defendants have failed to proffer
evidence of the high end, as well as the low end, of the
range of rates commanded by very experienced counsel in
their proposed sub-market.

App. 36-37 (emphasis added).

Judge Lamberth also set forth the burden that "parties opposing
fee awards" must bear in the future in order to prevail:

A statistically reliable, well-documented, and extensive

survey of the rates clients pay for a certain sub-market of

legal services would be powerfully persuasive. Such a

survey would collect the rates of a statistically significant

number of lawyers or firms within a legal sub-market,

convincing the court that the survey’s scope is broad

enough to reflect the market faithfully. Such a survey

would be sufficiently documented with supporting affida-
vits, assuring the court of the accuracy of the survey’s |
data. Lastly, such a survey would encompass both the high {
rates that large, prestigious law firms in the area command

for their work in the sub-market and the lower rates com-

manded by others for their work in the sub-market.

App. 37-38 (emphasis in original).

13
C. Sexcius.

Counsel in this first amendment/employment case were two
experienced attorneys, Francine K. Weiss and Edith Barnett, who,
pursuant to a retainer agreement, were paid $100.00 per hour for
their time. Despite that fact, they sought a hourly rate of $260.00
from the District of Columbia. App. 54.

Their fee application was more meager than that in Covington.
They did not initially disclose their billing rates for fee-paying
clients, but simply requested Laffey-matrix rates. Eventually they
filed declarations stating that they “do not have ‘established billing
rates’” and that, “because counsel’s clients are unable to pay the
rates prevailing in the community for complex federal litigation and
are frequently unemployed, our rates vary from a pure contingent
fee to $187.50 per hour." J.A. (II)71; see also J.A. (1174.

The Honorable Royce C. Lamberth awarded Laffey-matrix rates
in a decision that tracks his decision in Covington. Among other
matters, he rejected the argument that the rate counsel charged in
this case should be regarded as the market rate on the grounds that
the D.C. Circuit in SOCM had ruled that "/cJ/ounsels’ usual billing
rate is . . not directly relevant" in determining the market rate for
an attorney who takes a case on a reduced-fee basis. App. 56 n.4
(emphasis added).

D. Galloway.

In this case, challenging the exclusion of a blind attorney trom
jury service, plaintiff's lead counsel, Vicki G. Golden, sought
Laffey-matrix rates in a case in which she represented the plaintiff
on a contingent-fee basis. She initially did not provide any informa-
tion about her billing practices although she is a partner in a small
District of Columbia firm. Subsequently, in language identical to
that of counsel in Sexcius, she averred that, “[b]ecause my clients
are unable to pay the rates prevailing in the community for complex
federal litigation and are frequently unemployed, my rates vary from

14

ja] pure contingent fee to $200 per hour, and I rely to a great extent
on court-awarded fees for my compensation.” J.A. (1I1)50-51.

The Honorable Joyce Hens Green acknowledged that Ms.
Golden was seeking fees at an hourly rate she “has never earned .
. . in her primarily employment discrimination private practice."
App. 77. She ruled, however, that Ms. Golden was entitled to be
compensated at “the prevailing market rate." App. 77. She
explained:

Ms. Golden is exactly the type of private attorney who
charges reduced rates to clients due to non-economic goals
discussed in SOCM. As such, although in other cases the
attorney's ‘usual billing rate’ may be of great assistance to
the determination of the prevailing market rate, that is not
the case here.

App. 78 (emphasis added).

At the same time, however, Judge Green stated that she was
“not completely satisfied by the Laffey matrix” because, for exam-
ple, it “does not differentiate between an attorney with twelve years
of experience and one with eighteen years." App. 78 & 78 n.1.
Nevertheless, she held that the Laffey matrix "provide/s/ the most
credible evidence available of rates for this market" and that the
District’s “examples of what civil rights attorneys charge . . . is
insufficient to undercut . . . the Laffey matrix." App. 78 & 79
(emphasis added).

As a result, Judge Green, awarded fees to Ms. Golden at
Laffey-matrix rates: $250.00 per hour for her work in 1992 and
$260.00 per hour for her work in 1993.

IV. THE CouRT OF APPEALS.

A divided panel of the D.C. Circuit affirmed the decisions of
the district courts in all three cases. The decision of the panel
majority (Edwards, C.J., & Wald, J,) is principally devoted to an

15

unusually detailed discussion of the merits of the cases, the hourly-
rate evidence, and recitation of the abuse-of-discretion standard.
App. 1-21. The panel majority affirmed the decisions setting hourly
rates based on the updated Laffey matrices even though it too
acknowledged that these matrices were flawed:

Although fee matrices are somewhat crude -- the Laffey
matrix, for example, lumps attorneys with four to seven
years of experience in the same category; attorneys with
eleven to nineteen also share the same hourly rate -- the
matrices do provide a useful starting point. To supplement
any matrix that has been offered, plaintiffs may also pro-
vide surveys to update the matrix; affidavits reciting the
precise fees that attorneys with similar qualifications have
received from fee-paying clients in comparable cases, and
evidence of recent fees awarded by the courts or through
settlement to attorneys with comparable qualifications
handling similar cases.

App. 16 (emphasis added).

Judge Henderson dissented. App. 22-27. In her view, plain-
tiffs’ counsel had been awarded “premium hourly rates" despite the
fact that “none of the plaintiffs has demonstrated . . . that the rates
awarded prevail for the type of work performed or that the rates
their lawyers have historically been able to secure from paying
clients are not determinative of ‘a reasonable hourly rate.’" App.
22, quoting Blum v. Stenson, supra, 465 U.S. at 888.

Furthermore, she pointed out that the majority failed to follow
Circuit precedent placing the burden of proof on fee applicants.
First, although the court previously had ruled that "‘[ajn applicant
is required to provide specific evidence of the prevailing community
rate for the type of work for which he seeks an award,’" the tee
applicants here i:ad “chiefly rel[ied] on adjusted versions of the fee
matrix developed more than ten years ago in Laffey,” which cannot
constitute such evidence, “where, as here, the litigation is of a

16

discrete type that appears to generate its own range of rates." App.
22-23 (internal quotation marks omitted) (emphasis in original).

Second, the district courts had mistakenly placed "the burden of
proof on the District, not the applicants" and, “[bJjecause the
applicants have failed to submit evidence that carries their burden
. . «» the fee awards here are . . . based on a clear misapplication
of legal principles requiring reversal.” App. 24-25 (internal
quotation marks omitted) (emphasis in original).

Third, at least in Sexcius and Galloway, “the district court did
not give full effect to our precedent requiring it to consider the rates
customarily charged by counsel to their paying clients for whom
they have not reduced their rates in the public interest." App. 25
(emphasis in original). The D.C. Circuit previously had held that
"*the actual rate . . . [an] applicant’s counsel can command in the
market is itself highly relevant proof of the prevailing community
rate." App. 26 (emphasis supplied by Judge Henderson), quoting
National Ass'n of Concerned Veterans v. Secretary of Defense, 675
F.2d 1319, 1326 (D.C. Cir. 1982).

In short, Judge Henderson “dispute{d] . . . that a lawyer’s
billing history can be disregarded in favor of a rate that he has never
commanded." App. 26 n.7 (emphasis in original). And, she also
recognized that, despite the extensive factual discussion in the panel
majority's decision, it had endorsed a rule, legislative in nature, for
determining hourly rates in federal fee-shifting cases. From now
on, attorneys who charge less than the premium rates set forth in
the Laffey matrix must simply set forth that fact and aver that they
charge lower rates because they are public-spirited. They are then
entitled to the higher Laffey-matrix rates. The Laffey matrices are,
therefore, not merely the starting point, but the dispositive point.

A divided D.C. Circuit denied rehearing en banc. App. 83-84.
Judges Henderson and Williams would have granted rehearing.°

‘Judge Tatel did not participate.

17
REASONS FoR GRANTING THE WRIT

A divided D.C. Circuit has created a presumption that prevail-
ing counsel in federal fee-shifting litigation should be paid, not at
the rates they charge paying clients, nor at the rates that have been
shown to attract competent, successful counsel in similar cases.
Instead, it has held that these attorneys are entitled to recover fees
from defendants at the premium hourly rates charged by the leading
members of the bar in particularly complex cases -- Laffey-matrix
rates. It has done so even though the Laffey matrix was designed
to reflect only what extraordinarily skilled attorneys could command
for complex federal litigation; and even though none of the cases
here was particularly complex; the successful attorneys here do not
purport to be legal luminaries; and counsel here, as well as compa-
rable counsel in similar cases, do not command Laffey-matrix rates
in the marketplace. The panel majority’s decision, although invok-
ing the language of discretion and purporting to assess a proper
lodestar award, in fact creates a rule, legislative in nature, and
permits contingency enhancements to be awarded in a new guise.
It is not supported by accepted evidentiary principles or by the
policies underlying federal fee-shifting statutes.

Review by this Court is necessary for several reasons. First,
the decision seriously conflicts with the principles established by this
Court for awarding attorney’s fees under more than 100 federal fee-
shifting statutes. Second, the decision wrongly results in across-the-
board awards of premium Laffey-matrix rates to counsel who have
never been able to charge such rates in the marketplace and requires
defendants to pay fees higher than those necessary to attract compe-
tent counsel to fee-shifting cases. Thus, it wrongly results in
windfalls for attorneys; diverts scarce public resources to attorney
subsidies; and skews the market for legal services. Third, the
decision is in conflict with the decisions of other Circuits. Other
Circuits require fee applicants to bear the burden of proof and to
adduce specific evidence of the rates actually charged by the
prevailing attorneys in the marketplace and of the rates commanded
by comparable counsel in similar cases.

18

I. THE DECISION OF THE PANEL MaAjoriry Is IN CONFLICT
WITH THE DECcIsions OF THIS COURT.

A. THis CourT’s DECISIONS.

In Blum v. Stenson, supra, this Court set forth two principles
that are controlling here. There, this Court explained that, in
determining the appropriate hourly rate, or rates, in federal fee-
shifting cases:

. . . Courts properly have required prevailing attorneys
to justify the reasonableness of the requested rate or rates.
To inform and assist the court in the exercise of its discre-
tion, the burden is on the fee applicant to produce satisfac-
tory evidence -- in addition to the attorney’s own affidavits
-- that the requested rates are in line with those prevailing
in the community for similar services by lawyers of reason-
ably comparable skill, experience, and reputation.

465 U.S. at 896 n.11 (emphasis added). In addition, this Court
explained that the term "prevailing market rate" does not refer to a
single rate. Instead, it is a term of “convenience” used merely to
describe the reasonable hourly rate for a particular attorney’s servic-
es in a particular case. /d. Thus, this Court, reflecting elemental
economic theory and experience, recognized that “there is no such
thing as a prevailing market rate for the service of lawyers in a
particular community." /d. at 895 n.11. On the contrary, "[t}he
type of services rendered by lawyers, as well as their experience,
skill, and reputation, varies extensively - even within a law firm,"
and "[a]ccordingly, the hourly rates of lawyers in private practice
also vary widely." Id.

Furthermore, this Court in Dague rejected contingency enhance-
ments as well as the argument that reasonable attorney’s fees may
be set on any kind of class-wide basis. It stated that “any approach
that applies uniform treatment to the entire class of contingent-fee
cases, Or to any conceivable subject-matter-based subclass, cannot
possibly achieve the supposed goal of mirroring market incentives."

19

112 S. Ct. at 2642. And it recognized the validity of Judge Wil-
iiams’ observation in what became the D.C. Circuit’s dispositive
contingency-enhancement case, that any such a class-based approach
wrongly results in "‘the judicial judgment . . . defining the market,
not vice versa."" Id., quoting King v. Palmer, 906 F.2d 762, 770
(D.C. Cir. 1990) (Williams, J., concurring).

B. THE PANEL Masoriry’s DECISION.

The panel majority’s decision is in conflict with Blum and
Dague. It adopts a class-based approach for awarding attorney's
fees that cannot possibly reflect the market. Under the decision,
there are only two requirements for securing fees at the premium
levels contained in the Laffey matrix. First, an attorney must
demonstrate that his rate in a case is a “reduced” rate. This is now
easy to do because a reduced rate is any rate lower than the appli-
cable experience rate in the Laffey matrix. Second, an attorney
must establish that his rate reflects “non-economic” goals. This is
also now easy to do because counsel’s self-serving representation
that public-spiritedness has caused him to charge rates below the
premium rates in the Laffey matrix will suffice.°

In the cases before this Court, plaintiffs’ counsel were awarded
hourly rates well above those they have ever been able to command
in the marketplace. These awards were based almost exclusively on
the Laffey matrix, as updated by generalized and self-interested
attorney affidavits or by the Consumer Price Index, and by district

°The only difficulty the panel majority detected in its approach is to
distinguish between attorneys who charge below-market rates because they
are public-spirited and "attorneys who charge below-market rates because
they cannot command anything more.” App. 13. This observation high-
lights a fundamental flaw in the panel majority’s decision -- its failure to
understand that the rate an attorney can command in the marketplace is his
market rate and that rates lower than the premium rates charged by leading
members of the bar are also market rates if they are set by market forces
irrespective of whether an attorney is public-spirited.

20

court cases adopting the Laffey matrix.’ These awards were made
even though the District provided the only specific information
about actual rates charged by comparabie counsel in similar cases,
which were considerably below those in the Laffey matrix. Further-
more, prevailing counsel produced no evidence of any other kind --
e.g., that he or she is regarded as a leading expert in the field --
which would justify paying them more than they ever have been
able to charge a client.

The original Laffey matrix plainly has little probative force.
First, as Blum recognizes, in flat contradiction to the market, it
differentiates among attorneys only on a class-wide basis of blocks
of years of experience. Second, it was constructed based on the
hourly rates charged by luminaries of the District of Columbia Bar
to assist in establishing hourly rates for other luminaries of the Bar
in a complex class action. And when a Laffey attorney was not a
luminary, the district court there, based on the entire record before
it, reduced the matrix rate by one-third. In addition, in Laffey, the
district court based its decision, not on the matrix alone, but on the
affidavits from which it was derived, which showed what lawyers
with comparable qualifications and expertise actually charged their
clients. The Laffey matrix, therefore, was not intended to establish,
and did not establish, prevailing market rates for all members of the
District of Columbia Bar.

The updated Laffey matrices are no more probative. First, they
are based on the original Laffey matrix. Second, the methods used
to update it were unscientific. The private bar updates were based
on anecdotal information supplied by self-interested attorneys, which

’The panel majority relied on these cases even though the D.C. Circuit
~previously had ruled, correctly in the District's view, that "fees awarded
in other cases are probative of the appropriate community rate only if they
were determined based on actual evidence of prevailing market rates, the
attorneys involved had similar qualifications, and issues of comparable
complexity were raised.” National Ass'n of Concerned Veterans v.
Secretary of Defense, supra, 675 F.2d at 1325 n.7.

21

is entitled to little, or no, weight.’ The U.S. Attorney's Office
updates, in turn, are based on the Consumer Price Index, which
does not purport to be a scientific survey of prices for legal servic-
es. Third, the rates set forth in these matrices do not reflect the
wide range of rates attorneys actually charge in the market or the
rates attorneys actually charge for cases like the cases here.”

As a consequence, it is apparent that the decision of the panel
majority is based on an erroneous and counter-intuitive theory that
the fees necessary to attract competent counsel are higher than the
fees that in fact have been sufficient to attract counsel -- including
the counsel who have prevailed in the very cases for which fees are
sought. The panel majority has ruled that hourly rates, payable by
clients, which are acceptable to attorneys in non-fee-shifting |itiga-
tion or in fee-shifting litigation in which they do not prevail, are not
acceptable when defendants are paying the bill. Losing defendants

"See, e.g., U.S. Dep't of Labor v. Triplett, 494 U.S. 715, 723-25
(1990) ("[t}he impressions” of lawyers contained in affidavits concerning
the impact of fee levels on the ability of persons with good claims to
secure counsel “are blatantly insufficient to meet [the] . . . burden of
proof, even if entirely unrebutted,” particularly, where, as there, these
affidavits were “small in volume, anecdotal in character, and self-interested
in motivation. . .."). The D.C. Circuit sitting en banc made a similar
point in its dispositive contingency-enhancement case, King v. Palmer,
supra, 950 F.2d at 779 (expressing skepticism about some 70 “obviously
self-interested” affidavits submitted in support of a contingency enhance-
ment to lodestar awards and holding that anecdotal evidence from self-
interested attorneys cannot be “treated as determinative, or even weighty,”
in establishing a fee award).

"Indeed, plaintiffs’ counsel in Covington introduced a market rate
survey which, even though skewed toward large, commercial firms, under-
scored that the Laffey-matrix rates are premium rates. This survey, from
The National Law Journal, showed that partner rates in 1990 ranged from
$120.00 to $400.00 per hour and that associate rates ranged from $75.00
to $210.00 per hour. J.A. (1)117. The lowest Laffey-matrix rates for
1990-91 were $205.00 for partners and $120.00 for associates. J.A.
(111)37.

22

must pay a premium to attorneys who charge rates lower than
Laffey-matrix rates and who claim to do so for non-economic
motivations.

What this means, of course, is that the rates contained in the
Laffey matrix have become the floor for determining "reasonable"
hourly rates in fee-shifting cases in the District of Columbia, despite
the fact that attorneys are otherwise charging lower, competitive.
market-based rates. All plaintiffs’ attorneys litigating cases like the
ones here, whose rates are below the Laffey-matrix rates, will now
request and be awarded higher rates based solely on the experience
group into which they fall and irrespective of their qualifications and
skills (unless, of course, the District, or some other defendant.
produces a scientific survey sufficiently persuasive to rebut the non-
scientific Laffey matrix).

This rule is wrong as a matter of law; defies economic reality:
and is not supported by the evidence. First, the rule ignores the
broadly divergent marketability and competence of attorneys in the
District of Columbia. As Blum recognizes, because of market
forces -- which take into account factors such as type of services
rendered, skill, and reputation -- hourly rates vary widely even tor
attorneys practicing for exactly the same number of years. In
addition, it conflicts with Dague, which holds that across-the-board
enhancements may not be used in setting fees. Fee awards based on
the updated Laffey matrices, in which courts consider only years of
experience and ignore the marketability of individual attorneys,
constitute such an enhancement. Indeed, the award of any such
“premium rate . . . applicable only when the other side is paying,
looks like nothing so much as a disguised multiplier." Barrow v.
Falck, 977 F.2d 1100, 1105 (7th Cir. 1992) (Easterbrook, J.). See
also Davis v. San Francisco, 976 F.2d 1536, 1549 (9th Cir. 1992)
(Dague’s “rejection of contingency as a basis for multiplying a
lodestar fee similarly dictates that contingency not be a factor in the
setting of billing rates."). Finally, because the original Laffey
matrix was based largely on rates charged-by prominent and highly
skilled attorneys in the District of Columbia, its use results in costly
and unnecessary attorney windfalls.

23

In short, as Blum correctly acknowledged, reasonable hourly
rates for attorneys vary widely. Furthermore, the determination of
the “reasonable” or “prevailing market" rate for attorneys like those
here -- private, for-profit attorneys -- should begin by reference to
their established billing rate. While that rate is not, for that reason
alone, the reasonable hourly rate, it should be considered highly
relevant proof of their prevailing community rate. A court must
then examine the hourly rates “prevailing in the community for
similar services by lawyers of reasonably comparable skill, experi-
ence, and reputation,” Blum v. Stenson, supra, 465 U.S. at 896
n.11, and, in the exercise of its discretion, set a reasonable hourly
rate. There is no single rate that can, or should, be applied to
attorneys of a given length of experience.

Il. THE PANEL MaAJjoriry’s DECISION Is IN CONFLICT WITH
THE DECISIONS OF OTHER CIRCUITS.

There have long been conflicts and tensions among the Circuits
over how to calculate a reasonable hourly rate in accordance with
footnote 11 of Blum. Indeed, as long ago as 1987, the Third
Circuit, in Student Public Interest Research Group v. AT & T Bell
Laboratories, 842 F.2d 1436, 1443-48 (3d Cir. 1988) ("SPRIG"),
identified four distinct interpretations of that footnote in the context
of awarding fees, under federal fee-shifting statutes, to attorneys
with for-profit practices:

(1) the billing rate rule, mandating the rate an attorney actually
charges clients (citing the panel decision in SOCM, 826 F.2d 43
(D.C. Cir. 1987); and Shakopee Mdewakanton Sioux Community v.
Prior Lake, 771 F.2d 1153 (8th Cir. 1985), cert. denied, 475 US.
1011 (1986));

(2) the micro-market rule, emphasizing rates "public interest"
lawyers are able to command in the market and permitting a
departure from an attorney’s own billing rate only when that rate is
out of line with rates charged in the micro-market by attorneys of
comparable skill and experience (citing Lightfoot v. Walker, 826
F.2d 516, 524 (7th Cir. 1987); Mayson v. Pierce, 806 F.2d 1556

24

(11th Cir. 1987) (per curiam); and Coulter v. Tennessee, 805 F.2d
146, 148-50 (6th Cir. 1986), cert. denied, 482 U.S. 914 (1987)):

(3) the modified billing rate rule, applying an attorney’s custom-
ary billing rate, even if it does not appear to reflect the value of the
services rendered, and adding to the lodestar a contingency enhance-
ment (citing Pennsylvania v. Delaware Valley Citizens’ Council for
Clean Air, 483 U.S. 711 (1987)); and

(4) the community market rate rule, applying the rates charged
by counsel of comparable skill, experience, and reputation without
regard to an attorney’s regular billing rates (citing White v. Rich-
mond, 713 F.2d 458 (9th Cir. 1983); and Hall v. Ochs, 817 F.2d
920, 928-29 (Ist Cir. 1987))."°

Since SPRIG, and despite Dague’s holding that contingency
enhancements may not be awarded, the conflict over the meaning of
footnote 11 in Blum has continued and intensified. As the following
examples demonstrate, the Circuits differ among each other and
even internally. Furthermore, although the D.C. Circuit abandoned
a Strict actual billing rate rule in SOCM, the community market rate
rule applied in this case is in sharp conflict with the decisions of

See also Webb v. Maldonado, 484 U.S. 990 (1987) (White, J.,
dissenting from denial of certiorari) (noting square conflict between the
Ninth Circuit in that case and the D.C. Circuit in Laffey v. Northwest
Airlines, Inc., 746 F.2d 4 (1984), cert. denied, 472 U.S. 1021 (1985); the
tension between the Ninth Circuit’s approach and that of the Sixth and
Seventh Circuits; and the importance of resolving the issue of how a
reasonable hourly rate should be calculated in light of the recurring nature
of the issue and the fact that there are more than 100 federal fee-shifting
statutes authorizing an award of a reasonable attorney's fee to prevailing
parties). Although the D.C. Circuit overruled Laffey in its en banc
decision in SOCM insofar as Laffey held that for-profit attorneys could
never recover more than they charged clients, the conflict and tension
among the Circuits have not diminished and the importance to the courts
and litigants of a definitive resolution of how a reasonable hourly rate
should be calculated in light of Blum has increased.

25

other Circuits and with its own earlier decisions interpreting Blum
and SOCM. None of the other Circuits has adopted a rule that
permits prevailing for-profit attorneys to recover hourly rates higher
than those they have ever been able to charge based on evidence of
what other attorneys in a general experience group may charge.

In Barrow v. Falck, supra, for example, the Seventh Circuit
appeared to move from a micro-market rule to a billing rate rule.
It reversed an hourly rate of $135.00, which the district court had
awarded based on “an affidavit from a member of the local bar that
_ . , the market rate for attorneys possessing the ‘experience,
qualifications, reputation and ability’ of plaintiff's lawyer is $135
per hour in civil rights cases." 977 F.2d at 1104-05. The district
court had done so even though plaintiff's lawyer had revealed that
his client, a labor union, had paid him between $80.00 and $110.00
for his work in that case and “that this was the rate he regularly
charged for his own services, and that he had never in his lite
received a fee exceeding $120 per hour." /d. at 1105. In revers-
ing, Judge Easterbrook, writing for the court, explained:

Perhaps other attorneys . . . have market rates in the
range of $135; rates vary with skill and the time a lawyer
needs to accomplish a task. But this attorney had a market
rate of $110 or less. “[I]t is not the function of judges in
fee litigation to determine the equivalent of the medieval
just price. It is to determine what the lawyer would re-
ceive if he were selling his services in the market rather
than being paid by court order.” . .

At oral argument counsel suggested that the fee he
negotiated with the union was too low and that the full
agreement called for $80-$110 with certainty plus gravy if
he won and could persuade the judge to award more. So
stated, the arrangement is a form of contingent fee -- a
bonus for winning. . . . [H]owever, the Supreme Court
[has] held that risk multipliers are forbidden under . . . fee-
shifting statutes. . ..

26

. . . Judges must stick to the market rate for the attor-
neys’ time -- that is to say, the opportunity costs of their
time, the rate they could receive in other engagements.
Unless there is evidence that attorneys receive more per
hour, from their own clients, in civil rights litigation than
in other kinds of litigation . . . the court must use the
hourly rate for the attorney’s regular legal services.

977 F.2d at 1105 (emphasis in original)."'

On remand, the district court again awarded an hourly rate of
$135.00, based upon new evidence that counsel previously had been
awarded this hourly rate in an action against the same defendant.
Once again the Seventh Circuit reversed. Barrow v. Falck, 11 F.3d
729 (7th Cir. 1993). In reversing, the court noted, inter alia, that
"[mjarket prices may go down as well as up; many lawyers have
reduced their rates during the recent period of soft demand for legal
services" and thus the earlier fee award “could not have resolved"
the attorney’s "market rate for the indefinite future." /d. at 731.
The court also noted that the earlier award had been made at the
time when “many judges believed it was appropriate to award" an
enhancement in cases taken on a contingent-fee basis, a belief
rendered erroneous by Dague, and the fact that a “judge made the
same mistake in an earlier case does not justify repetition." /d. at
731 & 732. Finally, the court again turned to the determination of
an appropriate hourly rate. It noted that, on remand, plaintiff's
counsel had not introduced evidence concerning what portions of his
business was at the various rates he charged but “instead offered a
flurry of affidavits about what other lawyers charge for their work
or hope to receive when courts set the rate." /d. at 732. The court
was not impressed because this lawyer had his own paying business.

"In Barrow, the Seventh Circuit specifically addressed the D.C.
Circuit’s en banc decision in SOCM, but, in contrast to the panel majority
here, interpreted SOCM as “hold{ing] that the market rate of legal time is
the opportunity cost of that time, the income foregone by representing this
plaintiff." Jd. at 1105.

27

It therefore awarded $95.00 per hour, the midpoint between his own
stated lowest and highest rates."

By contrast, the Tenth Circuit has adopted the micro-market
approach. Thus, in Beard v. Teska, 31 F.3d 942 (10th Cir. 1994),
the court, in an opinion written by the Honorable Milton I. Shadur
sitting by designation, awarded fees at a rate /ess than that custom-
arily charged by plaintiff's counsel to his clients because the rate
requested exceeded the rate charged by competent counsel doing the
same sort of work. Beard was a case in which counsel, “with a
deservedly high reputation in civil rights litigation,” brought his first
case under the Individuals with Disabilities Education Act
("IDEA"), 20 U.S.C. § 1400 et seg. Id. at 957. The evidence was
that plaintiff's counsel regularly charged $200.00 per hour for his
services and that he had been awarded this rate by courts in civil
rights cases, but that local IDEA specialists charged between $90.00
and $140.00 per hour and that the most frequently charged hourly
rate both locally and nationally by IDEA specialists was $125.00.
The court approved an hourly rate of $125.00. It explained that
"{t}here are of course different markets for different areas of
lawyer’s work,” and that the hourly rates of attorneys specializing
in house closings are less than those charged by corporate merger

'2¢6¢ also Gusman v. Unisys Corp., 986 F.2d 1146, 1150 (7th Cir.
1993) (remanding to district court for reconsideration of an hourly rate less
than that attorneys commanded in the relevant geographic market which
had been set by reference to the rates customarily charged by comparable
counsel in the market and noting that "[oJur recent cases have stressed that
the best measure of the cost of an attorney's time is what that attorney
could earn from paying clients"); Casey v. Cabool, Missouri, 12 F.3d 799,
805 (8th Cir. 1993) ("opportunity cost” is “the starting point for determin-
ing a presumptively correct hourly rate"), cert. denied, 115 S. Ct. 325
(1994). Compare Rum Creek Coal Sales, Inc. v. Caperton, 31 F.3d 169,
179 (4th Cir. 1994) (ruling that district court should have awarded to out-
of-state firm its customary rates even though they were higher than the
rates charged by local firms but also ruling that district court did not abuse
its discretion in reducing customary rates of local firm based on “his own
personal knowledge of the prevailing rates” in the area).

28

specialists, even though both may be handling real estate acquisi-
tions, /d. at 956. Purchasers of a home are, of course, free to hire
a merger specialist to handle their house closing, "[b]ut if and when
it comes down to fee shifting -- to imposing on the other side an
obligation to pay the lawyer's fee . . . -- the higher cost of the
merger specialist cannot properly be thrust on someone who did not,
after all, make the uneconomic choice of counsel." /d.

The Ninth Circuit, in turn, seems to have moved from a
community market rate rule to a micro-market rule.’ /n Davis v.
San Francisco, supra, a complex Title VII class action, the court
ruled that the district court had not abused its discretion in awarding
rates higher than those charged by plaintiff's counsel based on rates
charged by other attorneys engaged in complex Title VII class
actions. It also ruled that the city did not overcome this evidence
when "/t/he only evidence it presented concerning billing rates was
a survey done of the California legal market as a whole which dis-
cussed a wide variety of practice areas." 976 F.2d at 1547 (empha-
sis added).

Still other approaches have been followed by the Second and
Fifth Circuits. In Chambless v. Masters, Mates & Pilots Pension
Plan, 885 F.2d 1053 (2d Cir. 1989), cert. denied, 496 U.S. 905
(1990), the district court awarded plaintiff's counsel, a small firm,
rates set by reference to its personal knowledge of the rates charged
by small and medium firms and rejected plaintiff's argument that he
was entitled to fee parity with the large firm that had represented the

"The Third Circuit in SPRIG cited the Ninth Circuit's decision in
White v. Richmond, supra, as adopting the community market rate rule.
In White, the court rejected the city’s complaint that the fee award should
be reversed because “prevaiiimg counsel were not required to submit
evidence of their own actual billing rates." 713 F.2d at 461 (emphasis in
original). In rejecting this argument, the court ruled that a trial court may
consider evidence of an attorney’s customary billing rate but does not
abuse its discretion in awarding a higher rate on the grounds that "many
civil rights practitioners do not bill their clients at an hourly commercial
rate." Id.

29

defendant. The Second Circuit affirmed, ruling that the district
court had not abu d its discretion in relying on his personal know!-
edge; that even a legal newspaper article plaintiff had introduced
had stated that it was “‘trickier’” for small and medium firms to
raise rates; and that the rates charged by defense counsel were
“‘irrelevant.’" Jd. at 1059.

In Islamic Center of Mississippi, Inc. v. Starkville, Mississippi,
876 F.2d 465 (Sth Cir. 1989), in turn, the Fifth Circuit remanded
a fee award based on hourly rates ($65.00 and $100.00) lower than
the rates customarily charged by plaintiff's counsel ($90.00 and
$120.00) which were within the “customary range" ($65.00 to
$150.00) in the relevant community for “complex civil-rights
litigation in federal court... .." Jd. at 469, 467. The court did so
because the district court gave no reason for its reduction “although
the[] rates [requested] concededly fall squarely within the range of
prevailing market rates." Jd. at 469-70.

Even within the D.C. Circuit, there is a conflict over how to
determine a reasonable hourly rate. Thus, in Goos v. National
Ass'n of Realtors, supra, the court, adopting an approach similar to
that adopted in /slamic Center, held that the fact that an attorney's
hourly rate is below the Laffey-matrix rate is not sufficient, by
itself, to prove that it is "below market,” and it upheld a fee award
based on hourly rates well below those contained in the matrix
because those rates were the attorney’s customary rates and he had
averred that those rates were in line with rates charged by compa-
rable attorneys in comparable cases. 997 F.2d at 1568-69. And,
in Kattan v. District of Columbia, 995 F.2d 274 (D.C. Cir. 1993),
cert. denied, 114 S. Ct. 1398 (1994), the D.C. Circuit, adopting a
blended micro-market/community rate approach, upheld an hourly
rate of $125.00, the rate charged by experienced lawyers in similar
cases, to an attorney who had been charging $150.00 per hour, and
stated that "an attorney’s usual billing rate is presumptively the
reasonable rate, provided that this rate is ‘in line with those prevail-
ing in the community for similar services by lawyers of reasonably
comparable skill, experience, and reputation.’" Jd. at 278, quoting
Blum v. Stenson, supra, 465 U.S. at 895-96 n.11.

30

In short, the Circuits continue to employ a variety of conflicting
approaches to determine the meaning of this Court’s prevailing
market rate concept in Biwm and the nature of the proof required of
fee applicants to discharge their burden of proof. The panel
majority’s decision here squarely conflicts with the decisions of the
other Circuits on both of these points as well as with previous
decisions of the D.C. Circuit.

CONCLUSION

This case raises an important and constantly recurring issue that
has been wrongly decided by the D.C. Circuit and that should be
resolved by this Court. This Court should grant the petition for a
writ of certiorari and reverse the decision below.—

Respectfully submitted,

CHARLES F.C. RUFF
Corporation Counsel

CHARLES L. REISCHEL
Deputy Corporation Counsel
Appellate Division

DONNA M. MURASKY*
Assistant Corporation Counsel

Office of the Corporation Counsel

One Judiciary Square -- 6th Floor South
441 Fourth Street, N.W.

Washington, D.C. 20001

Telephone: (202) 727-6252 ext. 3303

*Counsel of Record

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386002_0910%3A1. Public record. Not legal advice.