United States District Court, District of Columbia
ELOUISE PEPION COBELL, by and through TURK R. COBELL, as the personal representative of her estate, et al., Plaintiffs,
SALLY JEWELL, Secretary of the Interior, et al., Defendants.
MICHAEL HARVEY UNITED STATES MAGISTRATE JUDGE.
matter was referred to the undersigned for adjudication of
Mark Brown's fee petition. In January 2017, this Court
granted that petition and awarded Brown $2.878 million in
fees. Thereafter, Brown filed a motion seeking prejudgment
interest on his fee award [Dkt. 4257]. That motion is fully
briefed and ripe for adjudication. Based on the entire record, the Court
finds that Brown is entitled to prejudgment interest of $736,
293.88, an amount calculated based on the simple, annual
interest rate of 6%.
matter arises from a class action filed in 1996 alleging that
the Department of the Interior had mismanaged Native American
lands it had held in trust since the late nineteenth century.
See Amended Complaint [Dkt. 3671] (Dec. 21, 2010),
at ¶¶ 3-4, 17. The parties agreed to a settlement
in 2009, the terms of which were approved by Congress in
2010, this Court in 2011, and the D.C. Circuit in 2012.
See Plaintiffs' Motion for Preliminary Approval
of the Settlement [Dkt. 3660] (Dec. 10, 2010), at 1; Final
Order Approving Settlement [Dkt. 3850] (Jul. 27, 2011), at 4;
Cobell v. Salazar, 679 F.3d 909, 913 (D.C. Cir.
2012). The settlement included an award to Plaintiffs'
counsel of $99 million in attorney's fees. Final Order
Approving Settlement, at 9-10.
counsel's motion for the award of fees omitted all of the
hours Mark Brown expended on the representation. See
Plaintiffs' Motion for Attorney's Fees and Expenses
of Class Counsel [Dkt. 3678] (Jan. 25, 2011). Brown
subsequently intervened, seeking a fee award of $5.517
million for 11, 615 hours of work he incurred on behalf of
the class. See Petitioner's Response to
Plaintiffs' Motion for Attorney's Fees [Dkt. 3699]
(Feb. 28, 2011). In 2011, Judge Hogan responded to
Brown's fee petition by withholding the amount that Brown
claimed he was due (and that claimed by another intervenor,
the Native American Rights Fund) in the Settlement Account,
and by releasing the balance of the $99 million fee award to
Plaintiff's counsel. Final Order Approving Settlement
[Dkt. 3850] (Jul. 27, 2011), at 9-10. Those fees not held in
the Settlement Account were distributed to class counsel on
November 24, 2012. Order [Dkt. 3923] (Dec. 11, 2012). After a
series of unsuccessful mediations, Judge Hogan referred
Brown's fee petition to the undersigned for resolution.
Referral Order [Dkt. 4124] (May 12, 2015).
January 31, 2017, the undersigned awarded Brown $2, 878,
612.52 for 8, 224 hours of work. See Cobell v.
Jewell, No. 96-CV-1285 (TFH/GMH), 2017 WL 421905, at *43
(D.D.C. Jan. 31, 2017). Plaintiffs paid the fee award on
February 28, 2017. Plaintiffs' Notice of Payment to Mark
Brown [Dkt. 4265] (Feb. 28, 2017).
Brown asserted a claim for fees based primarily on quantum
meruit, the Court calculated his fee award based on the terms
specified in his engagement letters with the Plaintiffs.
See Cobell, 2017 WL 421905, at *34-35. The Court
based Brown's hourly rate on the only rate included in
those engagement letters - $350 an hour - rather than, as
Brown had requested, hourly rates specified in the U.S.
Attorney's Office's current Laffey matrix.
Brown had requested present-day Laffey rates to
account for the time-value of money and to compensate for the
delay in him receiving his fee award. Id. at *34-35.
The Court rejected that request but permitted Brown to file a
motion seeking prejudgment interest on the fee award pursuant
to District of Columbia law.Id. at *35.
filed such a motion on February 18, 2017. He requests
prejudgment interest on his fee award pursuant to §
15-108 and § 15-109 of the D.C. Code, at an interest
rate of 6%, compounded annually, for a total amount of $819,
656.21. Brown Mot. at 10-11. Plaintiffs responded to
Brown's motion by denying that he is entitled to any
prejudgment interest under the law of the District of
Columbia. Brown's reply followed. The issue is now ripe
District of Columbia law, prejudgment interest is typically
“an element of complete compensation.”
Bragdon v. Twenty-Five Twelve Assocs. Ltd.
Partnership, 856 A.2d 1165, 1172 (D.C. 2004). It should
be awarded “absent some justification” for
denying it. Washington Inv. Partners of Delaware, LLC v.
Sec. House, K.S.C.C., 28 A.3d 566, 581 (D.C. 2011)
(internal quotations omitted). In its most extended treatment
of the subject, the District of Columbia Court of Appeals in
District of Columbia v. Pierce Associates, Inc., 527
A.2d 306 (D.C. 1987), described a shift in the common law
treatment of prejudgment interest. Under the older,
“penalty theory” view, prejudgment interest is
appropriate where a debtor, with full knowledge of the debt
owed, refuses to pay the creditor. Id. at 310-11.
Because of this refusal, the debtor is rightfully punished by
the imposition of interest for the duration of debtor's
refusal. Id. The penalty theory, therefore, places
significant weight on whether the debt was liquidated, as a
debtor should not be expected to pay a debt that is not
easily ascertained. Id.
recent cases in the District of Columbia have adopted the
“loss” or “unjust enrichment” theory
of prejudgment interest. Under that theory, the inquiry
concerning the liquidation of the debt is replaced with
consideration of what will fairly make whole the party who
has been deprived of the use of money. Id. at 311.
The plaintiff has experienced a loss for which it must be
made whole, while the party who has enjoyed the use of that
money has thereby been unjustly enriched. Id. As the
focus is on making the wronged party whole, the inquiry
places less emphasis on whether the debtor could have known
the amount it owed, which is to say whether the debt was
Court of Appeals in Pierce Associates, Inc., found
both of these theories of prejudg-ment interest reflected in
the District of Columbia Code: § 15-108 expresses the
penalty theory of prejudgment interest, while § 15-109
endorses the loss/unjust enrichment theory. Id.;
D.C. Code §§ 15-108, 15-109 (2016). Section 15-108
provides for prejudgment interest where a judgment is both a
“liquidated debt” and occurs in circumstances
where “interest is payable by contract or by law or
usage.” D.C. Code § 15-108. If either of these
requirements are not satisfied, an award of prejudgment
interest is not authorized under § 15-108.
15-109 is more flexible. It permits an award of prejudgment
interest as an “element [of] damages” in a breach
of contract case “if necessary to fully compensate the
plaintiff.” Id. § 15-109. It provides a
trial court with a “wide range of discretion in
awarding prejudgment interest.” House of Wines,
Inc. v. Sumter, 510 A.2d 492, 499 (D.C. 1986);
Edmund J. Flynn Co. v. LaVay, 431 A.2d 543, 550 n.6
(D.C. 1981); Noel v. O'Brien, 270 A.2d 350, 351
Court considers below Brown's request for prejudgment