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Dick Anthony Heller v. District of Columbia

December 29, 2011

DICK ANTHONY HELLER, PLAINTIFF,
v.
DISTRICT OF COLUMBIA, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Emmet G. Sullivan United States District Court Judge

MEMORANDUM OPINION

Plaintiff Dick Anthony Heller was the prevailing party in litigation before the United States Supreme Court, in which that Court held that the District of Columbia's "ban on handgun possession in the home violates the Second Amendment, as does its prohibition against rendering any lawful firearm in the home operable for the purpose of immediate self-defense." See District of Columbia v. Heller, 554 U.S. 570, 635 (2008). Pending before the Court is plaintiff's motion for attorney fees and costs pursuant to 42 U.S.C. § 1988 ("§ 1988"). Plaintiff is seeking an award of $3,126,397.25 in fees and costs. Pl.'s Mot. at 2. Defendants, by contrast, urge the Court to award no more than $840,166.24, see Defs.' Opp'n at 5,*fn1 arguing that plaintiff's counsel should not be permitted to "enrich themselves at the expense of taxpayers," particularly during this time of "financial crisis." Defs.' Opp'n at 1. Sensitive to the fact that the fees in this case will be paid by the taxpayers, this Court is left with the difficult task of closely scrutinizing plaintiff's fee petition to determine what is fair, reasonable, and just compensation for the legal services of plaintiff's attorneys. Upon consideration of plaintiff's fee petition, the opposition and reply thereto, defendants' notices and the opposition thereto, the arguments of the parties made during the hearings held on December 13, 2010 and March 23, 2011, the parties' post-hearing briefs and additional supplemental briefing ordered by the Court, the Court hereby determines that plaintiff's counsel is entitled to fees in the amount of $1,132,182.00 and expenses in the amount of $4890.27.

I. STATUTORY FRAMEWORK

Section 1988 authorizes a district court, in its discretion, to award a "reasonable attorney's fee" to a prevailing civil rights litigant. 42 U.S.C. § 1988. "[A] 'reasonable' fee is a fee that is sufficient to induce a capable attorney to undertake the representation of a meritorious civil rights case." Perdue v. Kenny A., 130 S. Ct. 1662, 1672 (2010); see also Blum v. Stenson, 465 U.S. 886, 897 (1984) ("[A] reasonable attorney's fee is one that is adequate to attract competent counsel, but that does not produce windfalls to attorneys.")(ellipsis, brackets, and internal quotation marks omitted).

The starting point for determining a reasonable fee is the "lodestar method," which "is the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate." Hensley v. Eckerhart, 461 U.S. 424, 433 (1983). "[T]he lodestar method produces an award that roughly approximates the fee that the prevailing attorney would have received if he or she had been representing a paying client who was billed by the hour in a comparable case[.]" Perdue, 130 S. Ct. at 1672. There is a "strong presumption" that the lodestar figure represents a reasonable attorney's fee, id. at 1673, because "'the lodestar figure includes most, if not all, of the relevant factors constituting a 'reasonable' attorney's fee,'" id. at 1667 (quoting Pennsylvania v. Delaware Valley Citizens' Council for Clean Air, 478 U.S. 546, 566 (1986)).

In calculating a reasonable fee award, the Court must make three separate determinations: (1) what constitutes a "reasonable hourly rate" for the services of plaintiff's counsel; (2) the number of hours that were reasonably expended on the litigation; and (3) whether plaintiff has offered "specific evidence" demonstrating this to be the "rare" case in which a lodestar enhancement is appropriate, and if so, in what amount. Miller v. Holzmann, 575 F. Supp. 2d 2, 11 (D.D.C. 2008); see also Covington v. District of Columbia, 57 F.3d 1101, 1107 (D.C. Cir. 1995). The fee applicant, however, "bears the burden of establishing entitlement to an award, documenting the appropriate hours, and justifying the reasonableness of the rates[.]" Covington, 57 F.3d at 1107 (citing Blum, 465 U.S. at 896 n.11; Hensley, 461 U.S. at 437). Likewise, "the burden of proving that an enhancement is necessary must [also] be borne by the fee applicant." Perdue, 130 S. Ct. at 1673. This Court, therefore, must first determine whether plaintiff has met his burden with respect to rates, hours, and enhancements. The Court will then consider plaintiff's request for reasonable expenses.

II. PLAINTIFF'S FEE AWARD

A. Reasonable Hourly Rate

The first significant issue this Court must decide is the appropriate hourly rate at which each of plaintiff's attorneys should be compensated. "[A] fee applicant's burden in establishing a reasonable hourly rate entails a showing of at least three elements: [1] the attorneys' billing practices;

[2] the attorneys' skill, experience, and reputation; and

[3] the prevailing market rates in the relevant community." Covington, 57 F.3d at 1107; see also Blum, 465 U.S. at 896 n.11 ("[T]he burden is on the fee applicant to produce satisfactory 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 reasonably comparable skill, experience, and reputation."). After careful consideration of this evidence, "the Court must then exercise its discretion to adjust [the requested rate] upward or downward to arrive at a final fee award that reflects the characteristics of the particular case (and counsel) for which the award is sought." Falica v. Advance Tenant Servs., 384 F. Supp. 2d 75, 78 (D.D.C. 2005) (internal quotation marks omitted) (citing cases); see also American Lands Alliance v. Norton, 525 F. Supp. 2d 135, 148 (D.D.C. 2007) (explaining that the district court must assure itself that the rate requested is "commensurate with the attorneys' skill and experience, and with the quality of the attorneys' work")(internal quotation marks omitted). The Court will begin by addressing the first element of the Covington rate inquiry: the billing practices of plaintiff's counsel.

1. Counsel's Billing Practices

With regard to this first factor, "an attorney's usual billing rate is presumptively the reasonable rate, provided that this rate is 'in line with those prevailing in the community for similar services by lawyers of reasonably comparable skill, experience, and reputation.'" Kattan ex rel. Thomas v. District of Columbia, 995 F.2d 274, 278 (D.C. Cir. 1993) (quoting Blum, 465 U.S. at 895-96 n.11). The attorneys in this case, however, do not have a usual billing rate. See Pl.'s Mot. at 14 ("As is typical among attorneys dedicated largely or exclusively to public interest work, Plaintiff's counsel lack relevant hourly billing practices."). Specifically, three of plaintiff's attorneys (Mr. Neily, Mr. Levy, and Mr. Healy) are employed by non-profit public interest organizations that do not charge hourly billing rates, and three of his attorneys (Mr. Gura, Ms. Possessky, and Mr. Huff) do not have standard, fixed hourly rates, as they frequently charge "sub-market rates in order to provide legal services to those who otherwise could not afford them." Pl.'s Mot. at 14-15. Plaintiff's counsel, therefore, is "entitled to an award based on the prevailing market rates." Covington, 57 F.3d at 1107 (explaining that attorneys "who either practice privately and for-profit but at reduced rates reflecting non-economic goals or who have no established billing practice" should be compensated based on the prevailing market rate).*fn2

2. Counsel's Experience, Skill & Reputation

"Second, prevailing parties must offer evidence to demonstrate their attorneys' experience, skill, reputation, and the complexity of the case they handled." Covington, 57 F.3d at 1108. This, in turn, requires an attorney to "'produce satisfactory 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 reasonably comparable skill, experience, and reputation.'" Id. (quoting Blum, 465 U.S. at 896 n.11). The D.C. Circuit has noted that "this second element of the reasonable-rate analysis informs the first element of the inquiry," explaining that "'[w]e do not propose . . . that all attorneys be remunerated at the same rate, regardless of their competence, experience, and marketability. We only aim to provide that their experience, competence, and marketability will be reflected in the rate at which they are in fact remunerated.'" Id. This factor, therefore, is of only limited utility to the Court because - as discussed above - plaintiff's attorneys do not have standard billing rates that reflect their experience, competence, and marketability.

The Court will note, however, the impressive qualifications of plaintiff's counsel. Indeed, with the exception of one attorney, plaintiff was represented by a team of skilled litigators with significant experience in the for-profit, nonprofit, and government sectors at both the trial and appellate level. See generally Pl.'s Mot. at 16-20 and the declarations cited therein.

3. Prevailing Market Rate

Given the limited utility of the first and second factors in this case, in order to determine a reasonable hourly rate for plaintiff's counsel, the Court must focus its inquiry upon the third factor: "the prevailing market rates in the relevant community for attorneys of reasonably comparable skill, experience, and reputation." Covington, 57 F.3d at 1107.

In the District of Columbia, a reasonable hourly rate for complex federal litigation has traditionally been determined through use of a matrix known as the "Laffey Matrix." The Laffey Matrix, which was developed 25 years ago in Laffey v. Northwest Airlines, 572 F. Supp. 354 (D.D.C. 1986), aff'd in part and rev'd in part on other grounds, 746 F.2d 4 (D.C. Cir. 1984), provides billing rates for attorneys in the Washington, D.C. market with various degrees of legal experience.*fn3 The initial Laffey Matrix was based upon the prevailing market rates from 1981-1982. As discussed more fully below, two different matrices have been used as proof of prevailing market rates in complex federal litigation in the District of Columbia. "One version, which is maintained by the Civil Division of the Office of the United States Attorney, calculates the matrix rate for each year by adding the change in the overall cost of living, as reflected in the United States Consumer Price Index for the Washington, D.C. area for the prior year, and then rounding that rate to the nearest multiple of $5. A second, slightly different version of the Laffey Matrix . . . calculates the matrix rates for each year by using the legal services component of the CPI rather than the general CPI on which the U.S. Attorney's Office Matrix is based." Smith v. District of Columbia, 466 F. Supp. 2d 151, 156 (D.D.C. 2006) (internal quotation marks and abbreviations omitted).

The Circuit has advised that in order to demonstrate the prevailing market rate:

[P]laintiffs may point to such evidence as an updated version of the Laffey matrix or the U.S. Attorney's Office matrix, or their own survey of prevailing market rates in the community. . . . To supplement any matrix that has been offered, plaintiffs may also provide 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.

Covington, 57 F.3d at 1109. Once the plaintiff has put forward his evidence, the burden falls upon the government to produce "equally specific countervailing evidence" which demonstrates that the plaintiff's proposed hourly rate is "erroneous." Id. (explaining that the government's burden in rebuttal is not without demand).

In this case, plaintiff argues for the alternative matrix, which calculates the rate using the legal services component of the CPI. Accordingly, plaintiff requests that Mr. Gura, Mr. Neily, Mr. Levy, Mr. Healy, and Ms. Possessky be compensated at a base rate of $589/hour (as each of these attorneys has 11-19 years of experience), and that Mr. Huff be compensated at the base rate of $361/hour (as he has 4-7 years of experience).*fn4

Plaintiff contends that these are the prevailing market rates for attorneys engaged in complex federal litigation in the Washington, D.C. area. As discussed below, plaintiff's principal support for his requested rates is a so-called "updated" version of the Laffey Matrix, which was developed by Dr. Michael Kavanaugh (the "Updated Laffey Matrix"). In further support of his requested rates, plaintiff has provided the Court with the National Law Journal's 2009 law firm rate survey, a declaration by a legal recruiter familiar with the Washington, D.C. legal market, the standard billing rates of defense counsel in this action, and citations to fee awards in other complex cases.

In response, defendants assert that plaintiff's requested rates are "unreasonable"; that Dr. Kavanaugh's matrix rests upon "deficient methodology"; and that the appropriate rate for compensating plaintiff's counsel should be determined by reference to the Laffey Matrix maintained by the Civil Division of the Office of the United States Attorney (the "USAO Laffey Matrix"). Defs.' Opp'n at 6, 14. Pursuant to the USAO Laffey Matrix, defendants contend that plaintiff's counsel should be compensated at the rates of $420/hour and $275/hour.*fn5 It is defendants' position that "[t]he USAO Laffey Matrix reflects prevailing market rates for representation in 'complex federal litigation,'" and that Dr. Kavanaugh's Updated Laffey Matrix "is an inappropriate measure of rates both in this case and more generally." Defs.' Opp'n at 7, 11. In support of this argument, defendants have provided the Court with declarations from economist Dr. Laura Malowane. The Court will explore these arguments and the evidence proffered by each side, in turn, beginning with a discussion of the parties' competing matrices.

As noted above, the USAO Laffey Matrix determines hourly rates for attorneys of varying experience levels by taking the hourly rates contained in the original 1982 Laffey Matrix and adjusting those rates for inflation based upon changes in the Washington, D.C.-area Consumer Price Index (the "CPI"). See supra at 10; see also Kavanaugh Decl. dated June 1, 2010, Docket No. 63-2 ¶ 8. Dr. Kavanaugh's Updated Laffey Matrix differs from the USAO Laffey Matrix in two significant ways. First, Dr. Kavanaugh uses the legal services component of the nationwide CPI (the "Legal Services Index") -- as opposed to the general, local CPI -- to measure inflation. Kavanaugh Decl. dated June 1, 2010, Docket No. 63-2 ¶ 9. Second, Dr. Kavanaugh "applies the specific legal services index to the more recent survey of rates for the Washington D.C. metropolitan area developed in 1989 in response to the remand decision in Save Our Cumberland Mountains." Kavanaugh Decl. dated June 1, 2010, Docket No. 63-2 ¶ 9. As a result of these differences, plaintiff contends that Dr. Kavanaugh's approach yields a more accurate estimate of current market rates than that of the USAO Laffey Matrix.

Plaintiff also directs the Court to Judge Kessler's opinion in Salazar v. District of Columbia, 123 F. Supp. 2d 8 (D.D.C. 2000) ("Salazar I"), in which that court found that Dr. Kavanaugh's Updated Laffey Matrix "more accurately reflects the prevailing legal rates for legal services in the D.C. community" than the USAO Laffey Matrix. Id. at 15. In reaching that conclusion, the Salazar I court found that the Updated Laffey Matrix had the "distinct advantage of capturing the more relevant data because it is based on the legal services component of the Consumer Price Index rather than the general CPI on which the U.S. Attorney's Office matrix is based." Id. at 14-15; see also Smith v. District of Columbia, 466 F. Supp. 2d 151, 156 (D.D.C. 2006) (Kessler, J.) (concluding that the Updated Laffey Matrix was "more accurate" than the USAO Laffey Matrix). It should be noted, however, that -- unlike this case -the defendants in Salazar I and Smith did not challenge the use of the Updated Laffey Matrix.

Plaintiff further contends that survey data from the National Law Journal corroborates the rates contained in Dr. Kavanaugh's matrix. Focusing on Washington, D.C.-based law firms, plaintiff proffers the following rate data:

Firmwide Top Rate Avg. Median Top Avg. Partner Partner Assoc. Rates Rates Rates Rates Arent Fox $755 $485 Dickstein $520 $950 $633 $630 $515 Hogan $540 $990 $675 $660 $550 McKenna $775 $471 $470 Patton $521 $990 $650 $625 $540 Boggs Venable $457 $975 $556 $550 $450 Pl.'s Mot. at 29. Plaintiff asserts that "[w]hile these real world rates are in line with the rates predicted by Dr. Kavanaugh's Updated Laffey Matrix, they are not remotely reflected by the U.S. Attorney's model. The USAO's predicted top rate for the absolutely most experienced attorneys in Washington is exceeded by the average billing rate of lawyers in at least three firms, and is within ten dollars of a fourth." Pl.'s Mot. at 29.*fn6

In addition, plaintiff also submitted a declaration from Robert Podgursky, a legal recruiter at Klein, Landau, Romm & Schwartz. In his declaration, Mr. Podgursky states that he has "reviewed the qualifications of Alan Gura, Clark Neily, Robert Levy, Gene Healy, Tom Huff, and Laura Possessky, including their educational background and work experience," and avers that his firm "could place all of these attorneys within top major law firms, where they would command market billing rates . . . [of] $500-900 an hour." Podgursky Decl., Docket No. 63-9 ¶¶ 8-9.

Plaintiff also cites to the fee award in Miller v. Holzmann, in which another member of this court approved rates ranging from $625-$750/hour for senior partners at Wilmer Hale. Pl.'s Reply at 5 (citing Miller, 575 F. Supp. 2d at 13).

Finally, plaintiff points to the standard billing rates for the attorneys who provided pro bono services to the District of Columbia in this litigation. Specifically, a pleading filed by defendants indicates that the historical, 2007-2008 standard billing rates for the attorneys who represented the District of Columbia in this litigation were $640-$800/hour for attorneys with 11-20 years of experience and $480/hour for attorneys with 4-7 years of experience. See Docket No. 79, Notice of Filing. Plaintiff asserts that these historic rates provide further support for the reasonableness of his proposed hourly rates -$589/hour and $361/hour. See Pl.'s Supp. Br., Docket No. 80.

Defendants respond by urging the Court to reject plaintiff's proposed rates, and instead argue that "[t]he appropriate rate for compensating plaintiff should be established by reference to the [USAO Laffey] Matrix, which is the presumptive rate in this jurisdiction for complex federal litigation." Defs.' Opp'n at 6. Defendants maintain that "most local court decisions on attorneys' fees have applied the USAO Laffey matrix, specifically rejecting Kavanaugh's approach." Defs.' Opp'n at 12 (citing cases); see also, e.g., Miller, 575 F. Supp. 2d at 17-18 (noting that "[Dr.] Kavanaugh's alternative methodology has achieved only limited acceptance in this District"). In support of this assertion, defendants direct the Court to Chief Judge Lamberth's opinion in Miller v. Holzmann, in which that court awarded fees at USAO Laffey Matrix rates based upon its determination that Dr. Kavanaugh's Updated Laffey Matrix lacked the requisite "geographic specificity" due to its reliance on the national Legal Services Index. 575 F. Supp. 2d at 17-18.

Defendants also argue that "the reasoning underlying the Kavanaugh matrix is deficient and does not justify the requested departure." Defs.' Opp'n at 14. In support of this assertion, defendants have proffered the declaration of Dr. Laura A. Malowane.*fn7 Dr. Malowane maintains that Dr. Kavanaugh's Updated Laffey Matrix should be rejected for several reasons, including that "[t]he US Legal Index is a nationwide average index and not specific to the Washington, D.C. metropolitan region" and that "[t]he US Legal Index is for flat-fee services rather than hourly rates." Malowane Decl. dated Aug. 11, 2009, Docket No. 64-4 ¶ 12. Based upon these and other purported deficiencies, Dr. Malowane concludes that the USAO Laffey Matrix is more appropriate than the Updated Laffey Matrix for determining attorneys' fees in cases involving complex federal litigation in the Washington, D.C. area. See Malowane Decl. dated July 9, 2010, Docket No. 64-4 ¶ 4.

In further support of their argument regarding the unreasonableness of plaintiff's proffered rates, defendants argue that "plaintiffs in this case were represented by an extremely small firm, and as various courts and Dr. Malowane recognize, small firms typically charge less than large firms." Defs.' Opp'n at 16; see Malowane Decl. dated Aug. 11, 2009, Docket No. 64-4 ¶¶ 33, 37 (explaining, among other things, that small law firms do not have the same overhead as larger firms and that, as a result, attorneys at small firms may be able to offer services at lower fees than those at their larger firm counterparts; observing that "[i]n general, law firm billing rates increase with the size of the firm"). Defendants further contend that "[c]counsel here simply assume that they should be paid the same amount as big-firm partners in the private world, but . . . nothing justifies that assumption. Lawyers at small firms typically earn less than lawyers at larger firms." Defs.' Opp'n at 17.

Finally, defendants attack the rate data offered by plaintiff as unreliable. First, with regard to the National Law Journal survey, defendants argue that "these rates 'are misleading and should not be used for comparison purposes' because they 'reflect nominal billing rates and not realized rates (i.e., the amount actually collected divided by the hours actually expended on the work).'" Defs.' Opp'n at 18 (quoting Malowane Decl. ¶ 36). Defendants further maintain that "[b]ecause small firms typically charge less than large firms, a survey of the nation's largest firms would therefore be valueless even if it were otherwise reliable." Defs.' Opp'n at 19. Second, with regard to the standard billing rates of defense counsel, defendants argue that this data is irrelevant, because, among other reasons: (i) "the rates of large firms are not an appropriate benchmark because lead counsel's firm has only two lawyers, and small firms routinely charge less than big firms"; and (ii) "the standard rates of pro bono counsel [] do not reflect what would have been required to incentivize even a large firm to take this case" because "in Supreme Court litigation, the firms frequently charge significantly lower than their highest rates or use alternative fee arrangements because of the reputational and professional opportunities those cases offer to the firms and the involved lawyers." Defs.' Opp'n to Pl.'s Supp. Br., Docket No. 81, at 2, 4.

Plaintiff urges the Court to reject these arguments. First, with respect to defendants' claims that the USAO Laffey Matrix is the "presumptive rate" for complex federal litigation in this jurisdiction, Defs.' Opp'n at 6, plaintiff contends that "Covington specifically instructs that the U.S. Attorney's matrix is to be afforded the same consideration as any other updated Laffey Matrix or a party's own survey" and argues that it would be "error to refuse consideration of any rate evidence, on the presumptive assumption that the government's matrix is controlling." Pl.'s Mot. at 27 (citing Covington, 57 F.3d at 1109).*fn8 Next, in response to defendants' economic arguments, plaintiff ...


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