Is there a New Cap on Recoverable Attorney Rates in EDVA?

There is yet further disagreement among the judges of the Eastern District regarding reasonable attorney hourly rates.  As we noted in a previous EDVA Update here, this disagreement is manifesting itself most frequently in the Alexandria Division, as judges there confront (and push back against) the higher hourly rates frequently charged by larger law firms in the Northern Virginia/ DC metro area.

Today’s example of the disagreement comes in the recent case of Integrated Direct Marketing, LLC v. Drew May, et al., 1:14-cv-1183, 2016 WL 3582065 (E.D. Va. June 28, 2016).  In this case, Judge Leonie M. Brinkema of the Alexandria Division of the Eastern District invited a plaintiff to file a motions for sanctions and attorney’s fees after successfully demonstrating that the defendant made materially false statements in both an affidavit and during courtroom testimony.  But after the plaintiff petitioned for over $63,000 in attorney’s fees, Judge Brinkema strongly criticized the hourly rates and record keeping of plaintiff’s counsel, and she cut the fee award down to only $17,000.

To justify their hourly rates, plaintiff (represented by attorneys from both the DC and Connecticut offices of Ogletree, Deakins, Nash, Smoak & Stewart, PC) relied upon the matrix of hourly rates approved by Judge Gerald Bruce Lee in Vienna Metro (discussed in a prior EDVA Update here).  But Judge Brinkema rejected the Vienna Metro matrix.  By doing so, she sided with Judge T.S. Ellis’s opinion in Route Triple Seven (also discussed in a prior EDVA Update here) in the ongoing dispute regarding hourly attorney rates.  Below is a summary of the experience levels of each attorney, the hourly rates sought by the plaintiff, and the rates awarded by Judge Brinkema:

Attorney’s Legal Experience Requested Hourly Rate Awarded Hourly Rate
30 years $ 545 $ 450
9 years $ 395 $ 350
6 years $ 335 $ 275
5 years $ 320 $ 250

To set these hourly rates, the court followed the rates determined by Judge Ellis in Route Triple Seven.  Significantly, Judge Brinkema did not rely upon any other expert witness testimony or evidence to set these hourly rates.  (And, as we saw in the Route Triple Seven case, there the court relied upon its own “experience” to determine an appropriate reasonable rate.)  These hourly rates are in sharp contrast to the $550 – $600 hourly rates approved by Judge Lee in Vienna Metro.

It is clear that a revolt against high hourly rates (or, at least, rates perceived as high) is brewing among many judges of the Alexandria Division of the Eastern District.  It also appears that a hard cap of approximately $450 – $500 for an experienced attorney’s hourly rate is forming, at least in the eyes of several judges who have rejected the Vienna Metro matrix.

New Trend in Attorney’s Fees Declarations?

As the judges of the Eastern District continue to differ regarding reasonable hourly rates for attorneys, practitioners need to be aware of a potential new trend regarding declarations supporting or opposing petitions for attorney’s fees.  Unfortunately, that new trend appears likely to make such petitions more detailed and time-consuming – and therefore, more expensive.

Traditionally, declarations supporting a petition for attorney’s fees in the Eastern District have followed a familiar pattern: An outside attorney reviews the hourly rates charged, the number of hours charged, the docket sheet, and selected motions/briefs.  The resulting opinions were usually based upon a “general” review of or familiarity with the litigation.  These reviews were not usually “deep dives” into the documents, pleadings, or billing records for a good, simple reason:  keeping costs down.

This custom may need to change, based upon the recent case of Salim v. Dahlberg, 1:15-cv-468 LMB / IDD, 2016 WL 2930943 (E.D. Va. May 18, 2016), which was covered by the EDVA Update here.  In that case, Judge Leonie M. Brinkema of the Alexandria Division was faced with a petition for attorney’s fees after the plaintiff prevailed on part of his civil rights claim.  The petition was supported by declarations from six leading attorneys, all whom have extensive experience in the Eastern District.  As Judge Brinkema said in her opinion, all six were “well-known to and well-respected by the Court,” and all “summarily conclude[d] that the hourly rates charged and hours worked were reasonable.”

In opposition, the defendant submitted one declaration by attorney Wayne G. Travell, a partner with Hirschler Fleischer’s Tysons office.  Despite the lop-sided number of supporting declarations, Judge Brinkema rejected much of the plaintiff’s fee petition (along with the conclusions in the six supporting declarations) and essentially adopted much of the opinion and analysis expressed by Mr. Travell.

Mr. Travell’s declaration is extensive, at 18 pages long with 47 paragraphs.  He discusses in detail the steps he took to form his opinion (including documenting the telephone calls he had with the respective counsel).  He recounts the applicable law, and then provides a detailed recitation of the facts (citing and quoting from the pleadings in the case).  The heart of his declaration, however, appears to be nearly eight pages of detailed examination of the plaintiff attorney’s time records, including identifying alleged instances of double-billing, block-billing, and vague entries.

In her opinion, Judge Brinkema sided with Mr. Travell’s declaration because he “actually reviewed counsels’ billing records, provide[d] a detailed analysis of those records, discusse[d] the specific issues involved in the case, and evaluate[d] the work performed with respect to those issues.”  In contrast (according to the court’s opinion), the six supporting declarations were unpersuasive because none went into a “detailed analysis of plaintiff’s counsels’ time sheets; instead, the declarants base their conclusions almost exclusively on a review of the pleadings and of [plaintiff counsel’s] declaration.”

Mr. Travell’s declaration is another example of judicial pushback in the Eastern District against excessive attorney hourly rates (or, at least hourly rates perceived as excessive by the bench).  But it also likely signals that some judges will more closely scrutinize petitions for attorney’s fees, including attorney declarations that support and oppose those petitions.  For this reason, Mr. Travell’s declaration is likely a roadmap for future petitions in the Alexandria Division, if not throughout the Eastern District.  And the irony is straight-forward:  While the intent may be to hold down hourly rates, the added expense of more detail in such declarations will ultimately increase the cost of litigation overall.  But regardless of this impact, practitioners need to be aware of this possibility.

Is the Standard for Summary Judgment Evolving in EDVA?

Is the standard for summary judgment evolving, and has the Eastern District kept up with the evolution? 

In a July 6, 2016 decision in Guessous v. Fairview Property Investments, LLC, (Dkt. No. 15-1055), the Fourth Circuit reversed Judge Lee on all six counts in a fairly standard discrimination case.  The Court found repeatedly that the record was sufficient to permit a reasonable jury to find for the plaintiff, yet the District Court had credited the Defendant’s summary judgment evidence and granted summary judgment.  Stated differently, the appellate court reminds us that a district court’s weighing the evidence at summary judgment is impermissible.

The adjustment to the summary judgment standard traces to a May 2014 Supreme Court decision in what was a fairly routine § 1983 case.  In Tolan v. Cotton, 572 U.S. __ , 134 S.Ct. 1861 (2014), a Texas district court had granted summary judgment to a police officer deciding that his conduct in a police shooting was “objectively reasonable.”  There was evidence on both sides of the summary judgment issues; the district court weighed the evidence and came down in favor of the police officer.

The Fifth Circuit affirmed, albeit on different grounds, but three judges on that court voted in favor an en banc hearing. The case could easily have been passed over at the certiorari stage (Justice Alito, joined by Justice Scalia, wrote a concurring opinion complaining that the case was so routine that the Court should not have granted certiorari), but it seemed that several of the Supreme Court justices were looking for the opportunity to remind lower courts that a judge’s function at summary judgment is not to weigh the evidence but to determine whether there is a genuine issue for trial.”  This is the time-honored directive from Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986), but the Court’s Tolan decision suggests that justices believed that the standard needed some reinforcing.

The Fourth Circuit followed Tolan a few weeks later in McAirlaids, Inc. v. Kimberly-Clark Corp., 756 F.3d 307, 310 (4th Cir. 2014).  It then quoted from Tolan: “It is an ‘axiom that in ruling on a motion for summary judgment, [t]he evidence of the nonmovant is to be believed, and all justifiable inferences are to be drawn in his favor.’”   Not long afterwards, in March 2015, the Fourth Circuit provided “further elaboration” of the summary judgment standard in Jacobs v. N.C. Admin. Office of the Courts, 780 F.3d 562, 568 (4th Cir. 2015).  In an ominous introduction that highlighted a “clear misapprehension of summary judgment standards”, the panel of Judges Floyd, Keenan, and Harris cited Tolan:

Ordinarily we would begin our discussion with a brief restatement of the standard of review for a motion for summary judgment. When “the opinion below reflects a clear misapprehension of summary judgment standards,” however, further elaboration is warranted. Tolan v. Cotton (citations omitted) (per curiam).

Given this harsh treatment of the district court, it was no surprise that the Fourth Circuit reversed in part and remanded for trial.  The Court observed that in the Tolan case the district court had “fail[ed] to credit evidence that contradicted some of its key factual conclusions” and “improperly ‘weighed the evidence’ and resolved disputed issues in favor of the moving party.”

The Tolan and Jacobs decisions arguably provide a course correction in the summary judgment standards in cases where there is conflicting record evidence. The frequent Tolan quote is this:

Where there is conflicting evidence, the court must credit the evidence of both sides and acknowledge that there is a genuine issue of material fact that cannot be resolved by summary judgment. See Tolan v. Cotton (stating that summary judgment is inappropriate where each side has put forward competent evidence that raises a dispute about a material fact).

Westlaw identifies more than 870 case citations to Tolan.  Granted, many of the citations are for the § 1983 issues, but the case still stands tall because of the adjustments to the summary judgment standard.  Since Tolan, the above quote appears in multiple summary judgment rulings by Judge Cacheris, and in several ruling by Judge O’Grady.  Magistrate Judge Buchanan has also cited Tolan.  The Westlaw search shows, however, no other reliance either way on Tolan in the Alexandria Division of the Eastern District.

Sometimes district courts cite only the controlling circuit court decision without mentioning the Supreme Court case. The leading Fourth Circuit authority is the Jacobs decision.  Westlaw confirms that Jacobs has been cited in 136 cases, with most of these from within the circuit; there are more than 70 citations from the Maryland District Court, but only four from the Eastern District of Virginia, and just one of those four is from the Alexandria Division.

The Fourth Circuit’s Guessous decision relies on both Tolan and JacobsThe Court writes:

The court must “view the evidence in the light most favorable to the [nonmoving] party.”  Tolan v. Cotton, 134 S. Ct. 1861, 1866 (2014) (internal quotation omitted).   “The court . . . cannot weigh the evidence or make credibility determinations.” Jacobs v. N.C. Admin. Office of the Courts, 780 F.3d 562, 568-69 (4th Cir. 2015).  In general, if “an issue as to a material fact cannot be resolved without observation of the demeanor of witnesses in order to evaluate their credibility, summary judgment is not appropriate.” Fed. R. Civ. P. 56 advisory committee’s note to 1963 amendment.

Guessous at 16-17.  It is after these pointed citations that the Court launches into its “reasonable jury” analysis.   “A reasonable jury could easily conclude, however . . .”       Id. at 22. “This alone would be enough to allow a reasonable jury to conclude. . .”   Id. at 23.  “[T]he record is sufficient to permit a reasonable jury to conclude . . .” Id. at 28.  “[A] reasonable jury would certainly be entitled to reach a different conclusion . . .”   Id. at 30.  The Court’s unanimous decision reversed and remanded on all six counts.

Because so much of the Eastern District’s civil docket encounters summary judgment, Tolan and Jacobs are important precedents.  Other districts within the circuit, mostly notably the District of Maryland, seem to have recognized the course adjustment.  The Guessous decision perhaps is a wake-up call to the rest of the circuit, including the Eastern District of Virginia, to recognize the appellate direction for a tighter summary judgment standard.