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Palmer v. Rice

July 11, 2005

ALISON PALMER ET AL., PLAINTIFFS,
v.
CONDOLEEZZA RICE, DEFENDANT.
MARGUERITE COOPER ET AL., PLAINTIFFS,
v.
CONDOLEEZZA RICE, DEFENDANT.



The opinion of the court was delivered by: John M. Facciola United States Magistrate Judge

REPORT AND RECOMMENDATION

I. BACKGROUND

By an Order dated January 19, 1989, this court found that the Department of State ("State") had discriminated against women in the administration of a written examination that applicants for positions in the Foreign Service were obliged to take. As part of the relief awarded, it enjoined State from administering any written examination that had an adverse impact upon women.

In 2002, plaintiffs and State entered into a Consent Decree. Pursuant to the decree, the court certified as a class all female applicants who took, but did not pass, the 1991, 1992, 1993, or 1994 Foreign Service Written Examinations. The decree also permitted 390 members of the plaintiff class to participate in the Oral Assessment phase of the Foreign Service application process. These women, referred to as the invitees, had the highest non-passing scores on the 1991-1994 examinations.

Under the Consent Decree, plaintiffs' counsel ("the Terris firm") were obliged to locate the invitees and inform them of their legal rights. Between February 1, 2002 and January 14, 2003, the Terris firm performed this task. Plaintiffs now seek $155,706.55 in attorneys' fees and $25,354.42 in costs*fn1 for work done during this period, the lion's share of which involved contacting and locating the 390 sub-class members.

On April 14, 2004, I issued a Memorandum Opinion concluding that an evidentiary hearing was necessary before I could determine the reasonableness of the fees sought. Because it appeared thatlawyers and paralegals had performed the same work, there seemed to be a problem of under-delegation. There also appeared to be a problem of claiming fees for purely clerical tasks that should not have been billed and should have instead been considered overhead. See In re Olson, 884 F.2d 1415, 1426-27 (D.C. Cir. 1989) (allowing fees for work done by clerks and paralegals but disallowing compensation for "librarians, clerical personnel and other support staff"). In addition, based on the entries themselves, I could not determine why the work that was done required a lawyer's training and skill when similar work had been done by a paralegal.

As a result, I ordered that an evidentiary hearing be held on several issues, as well as any other factual issues addressed by the parties. These issues included:

1. What in fact did the lawyers do in the thirteen categories of work they specified, and why did what they did require a lawyer's training and skill?

2. Was it necessary for the lawyers who billed at the highest rate to do the work they did in those categories of work where paralegals also worked? Could the work have been delegated to more junior lawyers or even a paralegal?

3. Would the market tolerate a lawyer's billing $100 for the services the paralegals performed or would it insist that those services were overhead that the lawyer would have to absorb?

Memorandum Opinion, Apr. 14, 2004, at 11-12.

The evidentiary hearing was held from August 17, 2004 until August 20, 2004. Several legal issues arose at the hearing, including whether additional witnesses would be allowed to testify in a second phase of the hearing. These issues have now been briefed and decided, and all that remains is the ultimate determination of the parties' fee dispute. After careful consideration of the testimony and evidence offered by both parties, I have determined that plaintiffs are not entitled to the full amount of the fees and costs they seek. By the same token, it would be inappropriate to deny them any compensation at all. Accordingly, I recommend that the fees be reduced for the reasons stated herein.

II. FINDINGS OF FACT

A. The Search Process

1. There are between 13,000 and 14,000 class members in this litigation, but only 390 of these class members are women who, based on their performance on the Foreign Service Written Examination, were invited to take the Oral Assessment. These 390 sub-class members, or invitees, are the women plaintiffs located during the time period of February 1, 2002 through January 14, 2003.

2. The Terris firm had the obligation of notifying these women of the Consent Decree and their legal rights under the agreement.

3. Until the invitees received copies of the Consent Decree, the women had no knowledge of the class action lawsuit.

4. If plaintiffs' counsel failed to locate and notify an invitee of the lawsuit and the relief counsel had secured on behalf of the plaintiff class, she would lose her legal right to participate in the Oral Assessment.

5. There were two key elements to the search: (1) determining the current address of each invitee, and (2) making contact with each invitee to verify that she was the woman that took the Foreign Service Written Examination in the early 1990s.

6. On April 22, 2002, State provided plaintiffs' counsel with: (1) the names and mailing addresses of all class members, as provided by the individuals at the time of or during registration for the 1991, 1992, 1993, or 1994 Foreign Service Written Examinations; and (2) the names, dates of birth, social security numbers, and mailing addresses of the 390 invitees, as provided by these individuals at the time of or during registration for the 1991, 1992, 1993, or 1994 Foreign Service Written Examinations.

7. Once the Consent Decree was granted preliminary approval by the court on May 8, 2002, Monica Wagner ("Wagner"), a previous member of the Terris firm who worked extensively on this litigation and now serves as Of Counsel, directed paralegal David Ramirez ("Ramirez") to begin searching for two classes of women whose addresses (that had been provided by State) were likely to be inaccurate. These categories of women were: (1) women whose addresses were clearly college addresses, and (2) women who had overseas addresses.

8. Sarah Adams ("Adams"), an attorney with the Terris firm, was responsible for the daily management of the search process. As of August 2004, she had never taken a deposition, argued before the court, or tried a case. She did have previous experience searching for 1000 Bureau of Prisons employees. This search, however, was quite different from the search at issue in this case, as illustrated by the following chart:

Bureau of Prisons EmployeesPalmer Invitees MenWomen Unlikely to have changed their namesLikely to have changed their names (e.g., upon marriage) Established in their careersRecent graduates at time of the exam and last-known addresses Less mobileInterested in international work and therefore more likely to be mobile Because a financial reward was at stake, class members had an incentive to replyBecause limited relief (the ability to submit to the Oral Assessment phase of an exam they had taken 10 years earlier) was available, they had less incentive to respond to correspondence

9. On May 23, 2002, the Terris firm, via a company called Alpha Graphics, mailed to all class members the Consent Decree and notice of the Fairness Hearing. The letters were not sent via certified mail, nor was return receipt requested.

10. After receiving many phone calls in response to that letter, there was a second mailing, dated June 14, 2002, explaining that only the invitees would be entitled to relief.

11. To facilitate the process of locating the 390 invitees and verifying their addresses, Ramirez created two databases: (1) a database of the entire class, and (2) a database of the 390 invitees.

12. Once the database for the invitees was created, it was not consistently or adequately updated as the search progressed.

13. At the same time, paper files were created for the women that were hard to locate, and search results were recorded in the paper files rather than the database.

14. For these women, the Terris firm had a policy under which the attorneys and paralegals who followed up on leads for the hard-to-locate women could not search for a woman unless they had her case file.

15. After the first mailing of May 23, 2002, approximately 35 women responded to the firm, and their addresses were verified.

16. For women who did not respond to the first mailing, plaintiffs claim, and Ramirez testified at the hearing, that he conducted a social security number search on Lexis. However, in his earlier deposition testimony, Ramirez testified that he did not perform any such searches.

17. There is no evidence--via printouts of Lexis results or via transactional fees billed by Lexis--that Ramirez performed social security searches on Lexis. There is only the testimony of various members of the Terris firm and Ramirez's own, self-contradicted testimony. In addition, exhibits introduced at the hearing reveal that there were entries in the database which state: "Address updated on Lexis." However, the Lexis printouts that appear in various search files indicate that the searches were not performed based on the women's social security numbers but on their names. For example, the Lexis searches often took the following form: "jane w/2 doe."

18. In light of this evidence, the court credits Ramirez's deposition testimony, discredits his hearing testimony, and finds that Ramirez never performed social security number searches on Lexis.

19. Another mailing was sent out on July 10, 2002. If an invitee responded to that mailing, she was marked as verified and her address was supposed to be updated in the database.

20. Ramirez remembered that he was involved in stuffing many, many envelopes in connection with these mailings, but he does not remember whether he billed this task to the case or to the office.

21. If the firm received no response from a particular woman, members of the firm used various Internet search engines, including google.com, yahoo.com, whitepages.com, verizon.com, and switchboard.com, in efforts to verify that they had her correct address and to determine whether there was another way they could contact her.

22. As of August 2, 2002, there were approximately 180 women for whom plaintiffs' counsel had been unable to verify addresses. At that point, Kathy Skipper ("Skipper"), counsel for defendant, performed a Westlaw search for these individuals.

23. Once the Terris firm received the Westlaw search results, they determined whether these addresses were new addresses. If so, another letter was sent to each woman for whom they had secured a new address.

24. Once again, if a woman responded, the database was supposed to be updated, and the search for that woman was completed.

25. Throughout this time period, Adams, Ramirez, Carolyn Mozden ("Mozden"), and L.J. Fletcher ("Fletcher")--all employees of the Terris firm--continued to perform searches on the Web, looking for correct addresses and other ways to contact the invitees and verify that they were the correct individuals.

26. Ramirez decided not to enter all of the information gleaned from phone calls or Internet searches into the database. He also decided not to delegate any of the database work to secretaries because they were unfamiliar with the case and he would have had to review their work.

27. During the course of the search, some invitees contacted the Terris firm, stating that they had already verified their contact information with the firm in the past and did not understand why they continued to receive letters addressed to their former addresses (presumably because they were then forwarded to their current addresses).

28. If Adams determined that all avenues had been exhausted in searching for a particular woman, the firm removed her from the list and replaced her name with an individual on the reserve list.

29. The evidence indicates that the Terris firm searched extensively before deciding not to pursue a particular woman. In one example, the invitee kept denying that she had ever taken the Foreign Service Written Exam, but the firm continued to make attempts to verify her identity. After many searches, the firm finally confirmed that she was the woman who in fact took the Foreign Service exam in the early 1990s. In other examples, members of the Terris firm pursued leads about prize-winning dogs, wineries, and weddings before giving up their quest to locate one of the 390 invitees and turning to the reserve list.

30. By the search deadline, plaintiffs had achieved close to a 99 percent success rate in terms of contacting and verifying the invitees. The Terris firm confirmed the identities of 385 out of 390 women.

31. At no point did the Terris firm consult outside vendors to determine how much the search and verification process would cost if performed by a third party.*fn2

B. The Billing Records

1. On three separate occasions after submitting its fee petition to the court, the Terris firm wrote off some of the time that they had originally submitted for compensation. Plaintiffs first reduced the amount of fees sought in their reply brief. Then, on July 15, 2004, plaintiffs again reduced the fees they sought, by approximately $8,000. In a letter to defense counsel, plaintiffs' counsel explained each of the reductions, including approximately one-third of Ramirez's time in the Creating and Using Database Category because he expended more time than necessary to perform this work. Finally, in August 2004, plaintiffs again wrote off an additional $1,000 in fees. The result of these reductions was to reduce the attorney's fees sought from $170,242.95 to $155,706.55.

2. Plaintiffs' fee petition included many vague billing records.

3. As evidenced by many gaps in the time slip descriptions, plaintiffs' fee petition included records that were not contemporaneously kept by the timekeepers who were doing the work. Many of these time records were kept by Ramirez, whose original time slips were blank but were later filled in before the fee petition was submitted to the court. Ramirez testified that no one asked him to provide descriptions of his time after he left the Terris firm and before the fee petition was filed.

4. There is some evidence that Ramirez started the search one month before the Terris firm received the April 22, 2002 list of invitees and their personal identifying information from State. There is no indication that, at that point, Ramirez had any idea of whom he was trying to locate.

5. Wagner, a former member of the Terris firm that now serves as Of Counsel, lives and works in Massachusetts.

6. The firm seeks compensation for Wagner's time at full Laffeyrates. However, Wagner charges the firm at a rate of $85 per hour for her work. She charges her Massachusetts clients at a rate of $140 per hour.

7. Wagner attended the Fairness Hearing in Washington, DC because it was the first substantive matter before Judge Kennedy and she had the requisite background knowledge of the case.

8. Wagner billed 5 hours of preparation and travel time on September 9, 2002 and 4 hours of travel time on September 11, 2002. Both of these entries were related to the Fairness Hearing.

9. Wagner bills clients based in Washington, DC her full billing rate when she travels because she believes that to be the custom in Washington, but she bills her Massachusetts clients at 50 percent of the Massachusetts travel rate because that is the custom in ...


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